The partnership of Jack, Kate and Louise provided for the division of net income or losess in the following manner:1. Bonus of 20% of income before bonus to Jack.2. Interest at 15% on average capital account balances to each partner.3. Remaining income or loss, equally to each partner.Net income of the partnership for the year was P90,000 and the average account balances for the year were:JackP100,000.00200,000.00Kate300,000.00LouiseHow much of the P90,000 should be distributed to Jack?Select the correct response:P27,000.00P39,000.00P6,000.00P33,000.00

Partnership is one of the agreement or arrangement between two or more than two persons in which…

Answered: How much of the P90,000 should be…

How much of the P90,000 should be distributed to Jack? Select the correct response: P27,000.00 P39,000.00 P6,000.00 P33,000.00

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Concept explainers

Production Budget

A budget can be defined as a financial plan designed by an undertaking for a definite period in the future that can contribute towards enhancing the financial success of the business undertaking. It is used to estimate the revenue and expenses. The budget generally takes into account both current and future income and expenses.

Question

The partnership of Jack, Kate and Louise provided for the division of net income or losess in the following manner:
1. Bonus of 20% of income before bonus to Jack.
2. Interest at 15% on average capital account balances to each partner.
3. Remaining income or loss, equally to each partner.
Net income of the partnership for the year was P90,000 and the average account balances for the year were:
Jack
P100,000.00
200,000.00
Kate
300,000.00
Louise
How much of the P90,000 should be distributed to Jack?
Select the correct response:
P27,000.00
P39,000.00
P6,000.00
P33,000.00

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