Oriole Co. reports net income of $53,000. Partner salary allowances are Pitts $17,000, Filbert $6,000, and Witten $8,000. Indicate thedivision of net income to each partner, assuming the income ratio is 55: 22:23, respectively.SalaryallowanceRemainingincomeTotaldivision ofnetincomeLAPitts$$Division of Net IncomeFilbert$$Wittento$$CATotal

In a partnership firm, salary allowances are first deducted from the net income and then the…

Answered: Oriole Co. reports net income of…

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

See similar textbooks

Similar questions

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.
The partnership of Chase and Chloe shares profits and losses in a 70:30 ratio respectively after Chloe receives a $14,000 salary. Prepare a schedule showing how the profit and loss should be divided, assuming the profit or loss for the year is: If an amount is zero, enter "0". For those boxes in which you must enter subtractive or negative numbers use a minus sign. (Example: -300) A. $40,000 Chase Chloe Total Salaries $4 Remaining income allocation Total division of income B. $12,000 Chase Chloe Total Salaries Remaining income allocation Total division of income C. S(10,000) Chase Chloe Total Salaries Remaining income allocation Total division of income %24 %24 %24 %24 %24 %24 %24 %24
1. Annual salary allowance to Gonzalez of $25,000. 2. Interest of 5% on each partner's capital balance on January 1. 3. Any remaining net income divided to Gonzalez and Van Home, 2:1. Gonzalez and Van Horne had $126,000 and $189,000, respectively, in their January 1 capital balances. Net income for the year was $115,000. Required: How much net income should be distributed to Gonzalez and Van Horne? Gonzalez: Van Horne: S
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
Dividing Partnership Income Black and Shannon have decided to form a partnership. They have agreed that Black is to invest $255,000 and that Shannon is to invest $85,000. Black is to devote one-half time to the business, and Shannon is to devote full time. The following plans for the division of income are being considered: Equal division. In the ratio of original investments. In the ratio of time devoted to the business. Interest of 5% on original investments and the remainder equally. Interest of 5% on original investments, salary allowances of $50,000 to Black and $75,000 to Shannon, and the remainder equally. Plan (e), except that Shannon is also to be allowed a bonus equal to 20% of the amount by which net income exceeds the total salary allowances. Required: For each plan, determine the division of the net income under each of the following assumptions: (1) net income of $157,000 and (2) net income of $215,000. Round answers to the nearest whole dollar. (1) (2)…
The Fig & Olive Co. reports net income of $25,100. Interest allowances are Fig $3,400 and Olive $6,200; partner salary allowances are Fig $18,300 and Olive $10,300 and the remainder is shared equally. Indicate the division of net income to each partner. (If an amount reduces the account balance then enter with a negative sign preceding the number eg.-15,000 or parentheses eg. (15,000).J Salary allowance Interest allowance on partners' capital Total salaries and interest Remaining income Total division of net income $ Fig Account Titles and Explanation Division of Net Income $ Debit Olive Prepare the entry to distribute the net income. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. List all debit entries before credit entries.) $ Credit Total
Dividing Partnership Income Morrison and Greene have decided to form a partnership. They have agreed that Morrison is to invest $279,000 and that Greene is to invest $93,000. Morrison is to devote one-half time to the business, and Greene is to devote full time. The following plans for the division of income are being considered: Equal division. In the ratio of original investments. In the ratio of time devoted to the business. Interest of 5% on original investments and the remainder equally Interest of 5% on original investments, salary allowances of $60,000 to Morrison and $90,000 to Greene, and the remainder equally Plan (e), except that Greene is also to be allowed a bonus equal to 20% of the amount by which net income exceeds the total salary allowances Required: For each plan, determine the division of the net income under each of the following assumptions: (1) net income of $175,000 and (2) net income of $245,000. Round answers to the nearest whole dollar. (1) (2)…
Dividing Partnership Net Loss Lynn Carpenter and Matthew Fredrick formed a partnership in which the partnership agreement provided for salary allowances of $51,000 and $45,000, respectively. Determine the division of a $26,000 net loss for the current year, assuming that remaining income or losses are shared equally by the two partners. Use the minus sign to indicate any deductions or deficiencies. Lynn Carpenter Matthew Fredrick Total Salary Allowance $fill in the blank 1 $fill in the blank 2 $fill in the blank 3 Remainder $fill in the blank 4 $fill in the blank 5 $fill in the blank 6 Net Loss $fill in the blank 7 $fill in the blank 8 $fill in the blank 9
Partners B1 and B2 share income in a 2:1 ratio, respectively. Each partner receives an annualsalary allowance of P72,000. If the salaries are recorded in the accounts of the partnership as anexpense rather than treated as an allocation of profit, the total amount allocated to each partner forsalaries and profit would be a. unchanged for both B1 and B2b. less for both B1 and B2c. more for B1 and less for B2d. more for B2 and less for B1d. more for B2 and less for B1
2. The partnership of David White and Paul Wacker incurred net income of $40,000 for the current year. David had invested $30,000 and Paul had invested $45,000. Calculate he distribution share to each partner if profits are divided in the ratio of:a. Investmentsb. 3:1
9. JJ&T Partnership has three partners, James Small, Josh Platt, and Turner Lyle, who allocate net income according to the services provided and any remainder equally. The partnership agreement states that James and Turner will provide services for $2,500 a month while Josh will provide services for $3,750. For the fiscal year ending December 31, 2015, the partnership earned $192,600. Determine the amount allocated to each partner and prepare the journal entry to record the division of net income.
Dividing partnership income Dahl and Westhoff have decided to form a partnership. They have agreed that Dahl is to invest $400,000 and that Westhoff is to invest $100,000. Dahl is to devote one-third time to the business, and Westhoff is to devote two-thirds time. The following plans for the division of income are being considered: a. Equal division b. In the ratio of original investments c. In the ratio of time devoted to the business d. Interest of 5% on original investments and the remainder equally e. Interest of 5% on original investments, salary allowances of $80,000 to Dahl and $160,000 to Westhoff, and the remainder equally f. Plan (e), except that Westhoff is also to be allowed a bonus of $50,000 if net income exceeds $200,000 Required: For each plan, determine the division of the net income under each of the following assumptions: (1) net income of $300,000 and (2) net income of $750,000. Round answers to the nearest whole dollar. (1) $300,000 (2) $750,000 (2) $750,000…

Recommended textbooks for you

Essentials Of Investments

Finance

ISBN:

9781260013924

Author:

Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:

Mcgraw-hill Education,

FUNDAMENTALS OF CORPORATE FINANCE

Finance

ISBN:

9781260013962

Author:

BREALEY

Publisher:

RENT MCG

Financial Management: Theory & Practice

Finance

ISBN:

9781337909730

Author:

Brigham

Publisher:

Cengage

Essentials Of Investments

Finance

ISBN:

9781260013924

Author:

Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:

Mcgraw-hill Education,

FUNDAMENTALS OF CORPORATE FINANCE

Finance

ISBN:

9781260013962

Author:

BREALEY

Publisher:

RENT MCG

Financial Management: Theory & Practice

Finance

ISBN:

9781337909730

Author:

Brigham

Publisher:

Cengage

Foundations Of Finance

Finance

ISBN:

9780134897264

Author:

KEOWN, Arthur J., Martin, John D., PETTY, J. William

Publisher:

Pearson,

Fundamentals of Financial Management (MindTap Cou…

Finance

ISBN:

9781337395250

Author:

Eugene F. Brigham, Joel F. Houston

Publisher:

Cengage Learning

Corporate Finance (The Mcgraw-hill/Irwin Series i…

Finance

ISBN:

9780077861759

Author:

Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan Professor

Publisher:

McGraw-Hill Education

SEE MORE TEXTBOOKS