Quinto Capital (Sept 1) P20,000 (Jan 1) P165,000 (Apr 1) 75,000 Requirements: Prepare journal entries, dividing the profit for the year 2020 by using each of the following independent methods: 1. Beginning capital ratio 2. Average capital ratio (show average capital computations) 3. Ending capital ratio 4. Interest of 10% on average capital; annual salaries - Pinto, P12,000; Quinto, P6,000; the remainder, equally 5. Same as in No. 4, only that instead of P98,000 profit, the partnership earned P20.000 only

Quinto Capital (Sept 1) P20,000 (Jan 1) P165,000 (Apr 1) 75,000 Requirements: Prepare journal entries, dividing the profit for the year 2020 by using each of the following independent methods: 1. Beginning capital ratio 2. Average capital ratio (show average capital computations) 3. Ending capital ratio 4. Interest of 10% on average capital; annual salaries - Pinto, P12,000; Quinto, P6,000; the remainder, equally 5. Same as in No. 4, only that instead of P98,000 profit, the partnership earned P20.000 only

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

4. PG Merchandising, a general partnership earned a net profit of P98,000 for
the calendar year 2020. The capital account of the partners for the year
ended December 31, 2020 is shown below:
Pinto Capital
(Mar 1) P25,000 (Jan 1) P150,000
(Nov 1) P37,000 (Jul 1)
50,000
(Oct 1) 50,000

Quinto Capital
(Sept 1) P20,000 (Jan 1) P165,000
(Apr 1) 75,000
Requirements:
Prepare journal entries, dividing the profit for the year 2020 by using each
of the following independent methods:
1. Beginning capital ratio
2. Average capital ratio (show average capital computations)
3. Ending capital ratio
4. Interest of 10% on average capital; annual salaries - Pinto, P12,000;
Quinto, P6,000; the remainder, equally
5. Same as in No. 4, only that instead of P98,000 profit, the partnership
earned P20,000 only.

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