Left and Right are partners. Their capital accounts during 20X1 were as follows: Right, Capital Debit 8/23 Left, Capital T 6,000 Credit 1/1 4/3 10/31 Debit 3/5 9,000 Credit 1/1 7/6 30,000 8,000 6,000 Partnership net income is $50,000 for the year. The partnership agreement provides for the division of income as follows: 50,000 7,000 5,000 10/7 1. Each partner is to be credited 8 percent interest on his or her average capital (calculated after rounding to the nearest number of whole months). 2. Any remaining income or loss is to be divided equally. Required: Prepare an income distribution schedule. Note: Amounts that are to be deducted from an individual partner's capital balance should be entered with a minus sign.

Left and Right are partners. Their capital accounts during 20X1 were as follows: Right, Capital Debit 8/23 Left, Capital T 6,000 Credit 1/1 4/3 10/31 Debit 3/5 9,000 Credit 1/1 7/6 30,000 8,000 6,000 Partnership net income is $50,000 for the year. The partnership agreement provides for the division of income as follows: 50,000 7,000 5,000 10/7 1. Each partner is to be credited 8 percent interest on his or her average capital (calculated after rounding to the nearest number of whole months). 2. Any remaining income or loss is to be divided equally. Required: Prepare an income distribution schedule. Note: Amounts that are to be deducted from an individual partner's capital balance should be entered with a minus sign.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

d. Fallon and Springer formed a partnership on January 1. Fallon contributed $90,000 cash and equipment with a market value of $60,000. Springer contributed $30,000 of cash and inventory with a market value of $20,000, Partnership net income for Year 1 was $75,000. Determine each partner's share of the net income for each year, assuming income is divided based on the ratio of the partners original capital investments. Allocate Net Income Net income allocated to each partner Fallon Springer
Rex and Kelsey are partners who share income in the ratio of 3:2. Their capital balances are $95,000 and $140,000 respectively, on January 1. The partnership generated net income of $40,000 for the year. What is Rex's capital balance after closing the revenue and expense accounts to the capital accounts? a. $71,000 b. $119,000 c. $146,000 d. $111,000 e. None of the above.
Xavier and Yolanda have original investments of $50,000 and $100,000, respectively, in a partnership. The articles of partnership include the following provisions regarding the division of net income: interest on original investment at 10%; salary allowances of $38,000 and $28,000, respectively; and the remainder to be divided equally. How much of the net income of $77,000 is allocated to Yolanda? Oa. $77,000 Ob. $36,000 Oc. $44,000 Od. $38,000
A and B are equal partners. Assume that the partnership net income in the current year is 340800. The partnership agreement states as follows: Partners are entitle to Salary of: A - $45,000; B - $38,000 Interest on Capital: A - $7,000; B - $6,000 Interest charged on drawings: A - $2,500; B - $1,800 The Partners share profits and losses as follows: A: 60%; B: 40% Complete the multiple spaces below to calculate the Taxable Income of each partner. Just state the figure without any commas, full stops or dollar signs. If the figure is a negative, show it in brackets, eg (3000)
A partnership has the following accounting amounts: (1) Sales $70,000 (2) Cost of Goods Sold = $40,000 (3) Operating Expenses = $10,000 (4) Salary allocations to partners = $13,000 (5) Interest paid to banks = $2,000 (6) Partners' withdrawals = $8,000 Partnership net income (loss) is ____. One says 18,000 other says (3,000) a. $20,000 b. $18,000 c. $5,000 d. $(3,000)
The partnership agreement of Alix, Gise, and Bosco provides for the following income ratio: (a) Alix, the managing partner, receives a salary allowance of $108,000, (b) each partner receives 15% interest on average capital investment, and (c) remaining net income or loss is divided equally. The average capital investments for the year were: Alix $600,000, Gise $1,200,000, and Bosco $1,800,000. If partnership net income is $540,000, the amount allocated to Alix should be a. $90,000. Ch10,11,12 Principles of Accounting I b. $162,000. c. $180,000. d. $198,000.
Xavier and Yolanda have original investments of $51,500 and $100,100, respectively, in a partnership. The articles of partnership include the following provisions regarding the division of net income: interest on original investment at 20%; salary allowances of $27,200 and $29,600, respectively; and the remainder to be divided equally. How much of the net income of $114, 400 is allocated to Xavier? a. $37,500 b. $61, 368 с. $51,140 d. $27,200
The balance in Xue's capital account includes an additional investment of $10,000 made on May 5, 20Y2. Instructions: 1. Prepare an income statement for 20Y2, indicating the division of net income. The partnership agreement provides for salary allowances of $38,000 to Ramirez and $46,000 to Xue, allowances of 10% on each partner's capital balance at the beginning of the fiscal year, and equal division of the remaining net income or a net loss. 2. prepare a statement of partnership equity for 20Y2. 3. Prepare a balance sheet as of the end of 20Y2.
Xavier and Yolonda have original investments of $50,000 and $100,000 respectively in a partnership. The articles of partnership include the following provisions regarding the division of net income: interest on original investment at 10%, salary allowances of $27,000 and $18,000 respectively, and the remainder equally. How much of the net income of $40,000 is allocated to Xavier? 21. a. $20,000 b. $22,000 c. $32,000 d. $0 Moderate OBJ: LO: 12-02 DIF: PTS: 1 ANS: B KEY: Bloom's: Application NAT: BUSPROG: Analytic