P12-2B At the end of its first year of operations on December 31, 2017, RKC Company's accounts show the following. Partner Drawings Capital $15,000 $40,000 Riles Kinder 10,000 25,000 Crifui 5,000 15,000 The capital balance represents each partner's initial capital investment. Therefore, net income or net loss for 2017 has not been closed to the partners' capital accounts. Instructions (a) Journalize the entry to record the division of net income for 2017 under each of the independent assumptions shown below. (1) Net income is $50,000. Income is shared 5:3:2. (2) Net income is $43.000 Riles and Kinder are given salary allowances of $15.000
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.
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