Answered: Peter and Paul

Business

Accounting

Peter and Paul

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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Question

Peter and Paul are partners in a partnership. Their share of the partnership profits and losses are 60% and 40% respectively. Peter is a resident and Paul is a non-resident. In this income year, the partnership derived the following income:

interest income from an Australian Bank Account: $30,000

interest income from an overseas bank account: $18,000

Calculate the net income of the partnership and explain how that amount will be allocated and assessed in the hands of Peter and Paul.

Definition Definition Amount earned or lost on the sale of one or more items is referred to as the profit or loss on that item

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