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

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

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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ILLUSTRATION 37:-X, Y and Z were partners sharing profits and losses in the ratio 2 : 2 : 1. Their respective capital balances on 31.12.2014 were $ 5,00,000, $ 6,00,000 and $ 4,00,000 respectively. After closing the accounts for the year 2014, it was discovered that salaries of $ 20,000 p.a. to X and $ 30,000 to Z were ommited before distributing the profit. Profits for the year 2014 were $ 5,00,000 and the same have already been credited to their capital accounts. Instead of changing the audited Balance sheet, it was decided to pass a single adjusting entry in the beginning of the year 2015, so that accounts of previous year can be rectified.
1. Show how the following items will appear in the capital accounts of the partners Ali and Ahmed when their capital is a) fixed b) fluctuating Particulars Ali (R.O) Ahmed(R.O) Capital on 01.01.2021 90,000 70,000 Drawings during 2021-2022 12,000 9,000 Interest on Drawings 360 270 Interest on Capital 5,400 4,200 Partner's salary 12,000 Commission 6,000 Share of profit for 2021-22 6,000 4,000
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The A & B Partnership was established since 2005. On January 1, 2015, the partners agree to admit partner (C). Capital account balances and profit and loss sharing ratios at January 1, 2015, before the admission of partner (C), are as follows: Partner (A) (30%) $63,000 Partner (B) (70%) $97,000 Partner (C) invested $120,000 cash to the partners for 60% of capital interest and the partners agree about assets revaluation. The capital balance of partner B after admission is a. $82,000. a. $82,000. b. $78,000. b. $78,000. c. $91,000. c. $91,000. d. $97,000.
The capital account balances and profit and loss sharing ratios of the (A), (B), (C) and (D) partnership on December 31, 2014, after closing entries are as follows: Partner (A) (? %) $100,000 partner (B) (20%) $100,000 Partner (C) (10%) $40,000 partner (D) (20%) $60,000 Partner (B) is retiring from the partnership, and the partners agree that he will receive a cash payment of $120,000 in final settlement of his interest. The journal entry to record partner (B) retirement assuming that the partners agree about assets non-revaluation. a. Dr. (B) capital $120,000/Cr. Cash $120,000. a. Dr. (B) capital $120,000/Cr. Cash $120,000. b. Dr. (A) capital $17,500, (B) capital $90,000, (C) capital $4,500, (D) capital $8,000, /Cr. Cash $120,000. b. Dr. (A) capital $17,500, (B) capital $90,000, (C) capital $4,500, (D) capital $8,000, /Cr. Cash $120,000. c. Dr. (A) capital $12,500, (B) capital $100,000, (C) capital $2,500, (D) capital $5,000, /Cr. Cash…
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On February 28, 2023, the partners Anna, Juan. Berto authorized the liquidation of their partnership. The statement of financial position is as follows: AAA Statement of Financial Position February 28, 2023 Cash Non-cash assets Total Assets P10,000 Accounts Payable 290,000 Ana, Capital Required: a. Prepare the Cash Priority Program b. Prepare the journal entries for March 1, and March 4, 2023 P300,000 Juau, Capital Berto, Capital Total Liabilities and Capital P100,000 100,000 20,000 80,000 P300,000 Additional Informatic 1. The partner's profit and loss ratio were Amma, 40%; Juan, 40% and Berto 20% 2. On March 1, 2023, non-cash assets with a book value of P200,000 realized P150,000, and all available cash was paid to creditors and to partners. 3. On March 4, 2023. non-cash assets with a book value of P90,000 realized P70,000, and that amount was paid to partners.
E 16-7 Recording new partner investment The capital accounts of the Fax and Bel partnership on September 30, 2016, were: Fax capital (75% profit) $140,000 Bel capital (25% profit) 60,000 Total capital $200,000 On October 1, Rob was admitted to a 40 percent interest in the partnership when he purchased 40 percent of each existing partner’s capital for $120,000, paid directly to Fax and Bel. Required Determine the capital balances of Fax, Bel, and Rob after Rob’s admission to the partnership if goodwill is not recorded. Determine the capital balances of Fax, Bel, and Rob after Rob’s admission to the partnership if goodwill is recorded, assuming that the book value and fair value of recorded assets are equal.
Required information [The following information applies to the questions displayed below.] Ries, Bax, and Thomas invested $80,000, $112,000, and $128,000, respectively, in a partnership. During its first calendar year, the firm earned $249,000. Required: Prepare the entry to close the firm's Income Summary account as of its December 31 year-end and to allocate the $249,000 net income under each of the following separate assumptions. 2. The partners agreed to share income and loss in the ratio of their beginning capital investments. Complete this question by entering your answers in the tabs below. Appropriation of profits Allocate $249,000 net income in the ratio of their beginning capital investments. Note: Do not round intermediate calculations. Supporting Computations General Journal Ries Bax Thomas Percentage of Total Equity X Income Summary Allocated Income to Capital
The following are the condensed balance sheets of G&N Partnership at August 30, 2016, at which date Ellery is to be admitted with a 30% interest in capital for an investment of 55,000. Book Value Cash $ 20,000 Other assets 503,000 Total assets $ 523,000 Current liabilities 54,000 Non current liabilities 269,000 Gemmo, capital 120,000 Norma, capital 80,000 Total equities $ 523,000 Fair Value Cash $ 20,000 Other assets 417,000 Total assets 437,000 Current liabilities S 54,000 Non current liabilities 275,000 Gemmo and Norma share profits at 60% and 40%, respectively. Required: Choose the correct answer with solution. 1. What will be the respective capital balances of Gemmo, Norma, and Ellery after the new partner's admission. a. $68,460, $45,640, $48,900 b. $48,900, $45,640, $68,460 c. S45,640, $68,460, S48,900 d. $64,860, $49,240, $48,900
At the end of its first year of operations on December 31, 2010, KAT Company’s accountsshow the following.Partner Drawings CapitalH. Krik $15,000 $40,000N. Andres 10,000 25,000S.Thabo 5,000 15,000The capital balance represents each partner’s initial capital investment. Therefore, net incomeor net loss for 2010 has not been closed to the partners’ capital accounts.Required(A)Journalize the entry to record the division of net income for 2010 under each of theindependent assumptions:(1) Net income is $50,000. Income is shared 5:3:2.(2) Net income is $40,000. Kirk and Andres are given salary allowances of $15,000 and$10,000, respectively. The remainder is shared equally.(3) Net income is $37,000. Each partner is allowed an interest of 10% on beginning capitalbalances. Kirk is given a $20,000 salary allowance. The remainder is shared equally.(B) Prepare a schedule showing the division of net income under the assumption (3) above.(C) Prepare a partners’ capital statement for the year under…