Accounting (Text Only)
26th Edition
ISBN: 9781285743615
Author: Carl Warren, James M. Reeve, Jonathan Duchac
Publisher: Cengage Learning
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Question
Chapter 12, Problem 12.8EX
a.
To determine
It is that form of organization which is owned and managed by two or more persons who invest and share the
The division of income among the three members.
b.
To determine
To provide: The
c.
To determine
To prepare: A statement of members’ equity for 2016.
d.
To determine
To explain: The advantages of having an income sharing agreement for the members of LLC.
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LLC net income and statement of members' equity
Interactive Media, LLC, has three members: VC Partners, Colin Campella, and Active Graphics, LLC. On January 1, 2012, the three members had equity of $235,000, $60,000, and $140,000, respectively. VC Partners contributed an additional $60,000 to Interactive Media, LLC, on June 1, 20Y2. Colin Campella
received an annual salary allowance of $136,300 during 20Y2. The members' equity accounts are also credited with 15% interest on each member's January 1 capital balance. Any remaining income is to be shared in the ratio of 4:3:3 among the three members. The revenues, expenses, and net income for Interactive
Media, LLC, for 20Y2 were $481,667, $81,667 and $400,000, respectively. Amounts equal to the salary and interest allowances were withdrawn by the members.
a. Determine the division of income among the three members. If an amount box does not require an entry, leave it blank.
Line Item Description
Salary allowance
Interest allowance…
The ABC Corporation was formed on
January 1, 2017. The three initial owners
each invested $400,000 cash and each
received 40,000 shares of $1 par value
common stock. Below are selected
transactions that were completed during
January 2017.
1. Issue shares of common stock to the
owners.
2. Borrowed $320,000 on a one-year note
payable.
3. Purchased land by signing a $280,000
note payable.
4. Paid $40,000 of accounts payable.
5. Purchased two service vehicles for cash
at a cost of $96,000 each.
6. Purchased $8,000 of supplies on credit.
Question: Prepare the journal entries on
ABC's books for each transaction.
An investor company purchased 180,000 shares of common stock of the investee company on January 2, 2021. The investee company had 500,000 shares of common stock outstanding during 2021, declared and paid cash dividends of $241,000 during 2021, and reported net income of $738,000 for 2021. If the investor company uses the equity method of accounting for its investment in the investee company, the investor company should report revenue from investment (or Investment Income) for 2021 in the amount of $___________________. (Do not round your answer for any part of the computation.)
Chapter 12 Solutions
Accounting (Text Only)
Ch. 12 - Prob. 1DQCh. 12 - Prob. 2DQCh. 12 - Prob. 3DQCh. 12 - Prob. 4DQCh. 12 - Prob. 5DQCh. 12 - Prob. 6DQCh. 12 - Prob. 7DQCh. 12 - Prob. 8DQCh. 12 - Prob. 9DQCh. 12 - Prob. 10DQ
Ch. 12 - Prob. 12.1APECh. 12 - Prob. 12.1BPECh. 12 - Prob. 12.2APECh. 12 - Prob. 12.2BPECh. 12 - Prob. 12.3APECh. 12 - Prob. 12.3BPECh. 12 - Prob. 12.4APECh. 12 - Prob. 12.4BPECh. 12 - Prob. 12.5APECh. 12 - Prob. 12.5BPECh. 12 - Prob. 12.6APECh. 12 - Prob. 12.6BPECh. 12 - Prob. 12.7APECh. 12 - Prob. 12.7BPECh. 12 - Prob. 12.1EXCh. 12 - Prob. 12.2EXCh. 12 - Prob. 12.3EXCh. 12 - Prob. 12.4EXCh. 12 - Prob. 12.5EXCh. 12 - Prob. 12.6EXCh. 12 - Prob. 12.7EXCh. 12 - Prob. 12.8EXCh. 12 - Prob. 12.9EXCh. 12 - Prob. 12.10EXCh. 12 - Prob. 12.11EXCh. 12 - Prob. 12.12EXCh. 12 - Prob. 12.13EXCh. 12 - Prob. 12.14EXCh. 12 - Prob. 12.15EXCh. 12 - Prob. 12.16EXCh. 12 - Prob. 12.17EXCh. 12 - Statement of members equity, admitting new member...Ch. 12 - Distribution of cash upon liquidation Hewitt and...Ch. 12 - Distribution of cash upon liquidation David Oliver...Ch. 12 - Prob. 12.21EXCh. 12 - Prob. 12.22EXCh. 12 - Liquidating partnershipscapital deficiency...Ch. 12 - Prob. 12.24EXCh. 12 - Prob. 12.25EXCh. 12 - Prob. 12.26EXCh. 12 - Prob. 12.27EXCh. 12 - Prob. 12.28EXCh. 12 - Prob. 12.1APRCh. 12 - Prob. 12.2APRCh. 12 - Prob. 12.3APRCh. 12 - Prob. 12.4APRCh. 12 - Prob. 12.5APRCh. 12 - Prob. 12.6APRCh. 12 - Prob. 12.1BPRCh. 12 - Prob. 12.2BPRCh. 12 - Prob. 12.3BPRCh. 12 - Prob. 12.4BPRCh. 12 - Prob. 12.5BPRCh. 12 - Statement of partnership liquidation On August 3,...Ch. 12 - Prob. 12.1CPCh. 12 - Prob. 12.2CPCh. 12 - Revenue per employee The following table shows key...Ch. 12 - Prob. 12.4CP
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