JJ and KK are partners who shares profits and losses in the ratio of 60% and 40% respectively. JJ’s salary is P60, 000 and P30, 000 for KK. The partners are also paid interest on their average capital balances. In 20x1, JJ received P30, 000 of interest and KK, P12, 000. The profit and loss allocation is determined after deductions for the salary and interest payments. If KK’s share in the residual income (income after deducting salaries and interest)) was P60,000 in 20x1, what was the total partnership income? P192,000 P345,000 P282,000 P387,000
Partnership Accounting
A partnership is a kind of arrangement between two or more people whereby they agree to manage the business operations and share its profits and losses in an agreed ratio between them. The agreement that is drafted and signed by the partners of the firm is termed as partnership deed and contains various important clauses agreed between the partners such as profit/loss sharing, interest on capital, remuneration allocation of each partner, drawings, admission of a new partner, etc.
Partner Admission and Withdrawal
A partnership is a kind of arrangement between two or more people whereby they agree to manage the business operations and share its profits and losses in an agreed ratio between them. The agreement that is drafted and signed by the partners of the firm is termed as a partnership deed and contains various important clauses agreed between the partners such as profit/loss sharing, interest on capital, remuneration allocation of each partner, drawings of a partner, etc.
- JJ and KK are partners who shares profits and losses in the ratio of 60% and 40% respectively. JJ’s salary is P60, 000 and P30, 000 for KK. The partners are also paid interest on their average capital balances. In 20x1, JJ received P30, 000 of interest and KK, P12, 000. The
profit and loss allocation is determined after deductions for the salary and interest payments. If KK’s share in the residual income (income after deducting salaries and interest)) was P60,000 in 20x1, what was the totalpartnership income?
P192,000
P345,000
P282,000
P387,000
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