S13-5 Allocating profits and losses to the partners Bagwell, McWilliams and Briand have capital balances of $24000, $36000 and $60000, respectively. The partners share profits and losses as follows: a The first $50 000 is divided based on the partners' capital balances. b The next $50 000 is based on service, shared equally by Bagwell and Briand. McWilliams doesn't receive anything. c The remainder is divided equally. Requirements 1. Calculate each partner's share of the $112000 profit for the year. 2. Journalise the closing entry to allocate the net profit for the year.

S13-5 Allocating profits and losses to the partners Bagwell, McWilliams and Briand have capital balances of $24000, $36000 and $60000, respectively. The partners share profits and losses as follows: a The first $50 000 is divided based on the partners' capital balances. b The next $50 000 is based on service, shared equally by Bagwell and Briand. McWilliams doesn't receive anything. c The remainder is divided equally. Requirements 1. Calculate each partner's share of the $112000 profit for the year. 2. Journalise the closing entry to allocate the net profit for the year.

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

S13-5 Allocating profits and losses to the partners
Bagwell, McWilliams and Briand have capital balances of $24000, $36000 and $60000,
respectively. The partners share profits and losses as follows:
a The first $50 000 is divided based on the partners' capital balances.
b The next $50 000 is based on service, shared equally by Bagwell and Briand. McWilliams
doesn't receive anything.
c The remainder is divided equally.
Requirements
1. Calculate each partner's share of the $112 000 profit for the year.
2. Journalise the closing entry to allocate the net profit for the year.

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