ple and Mack had the lollowing clause in their partnership agreement: The partners allowed salaries as follows: Cole, P90,000; Mack, P72,000: and these salaries are to be charged against the earnings of the business. In addition, Cole is to be allowed a bonus of 20% of the net income after salaries and interest have been deducted, and this bonus is to be considered as an expense of the business. Any remainder is to be divided equally." If the net income after partners' salaries, interest, and bonus amounts to P397,500, and the interest on Cole's capital account is P37,280 and on Mack's capital account is P65,560, how much must be the share of Cole on the partnership net income?
ple and Mack had the lollowing clause in their partnership agreement: The partners allowed salaries as follows: Cole, P90,000; Mack, P72,000: and these salaries are to be charged against the earnings of the business. In addition, Cole is to be allowed a bonus of 20% of the net income after salaries and interest have been deducted, and this bonus is to be considered as an expense of the business. Any remainder is to be divided equally." If the net income after partners' salaries, interest, and bonus amounts to P397,500, and the interest on Cole's capital account is P37,280 and on Mack's capital account is P65,560, how much must be the share of Cole on the partnership net income?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:6.
ole and Mack had the Iollowing clause in their partnership agreement: The partners are to
allowed salaries as follows: Cole. P90,000: Mack. P72.000: and these salaries are to be charged
against the earnings of the business. In addition, Cole is to be allowed a bonus of 20% of the net
income after salaries and interest have been deducted, and this bonus is to be considered as an
expense of the business. Any remainder is to be divided equally."
If the net income after partners' salaries, interest, and bonus amounts to P397,500, and the
interest on Cole's capital account is P37,280 and on Mack's capital account is P65,560, how much
must be the share of Cole on the partnership net income?
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