Partnership : Partnership is one of the types of business origination. Under the partnership, two or more individuals agree to form a business together and share losses and profits in the predetermined ratio. Partner Return on equity: Partner Return on equity is the profitability measure to determine the % of return earned on the partner’s investment in the partnership. Partner Return on equity is calculated by dividing the Partner net income by Average Partner equity. The formula to calculate Partner Return on equity is as follows: P a r t n e r R e t u r n o n e q u i t y = P a r t n e r n e t i n c o m e A v e r a g e P a r t n e r e q u i t y The formula to calculate the Average Partner equity is as follows: A v e r a g e P a r t n e r e q u i t y = ( B e g i n n i n g P a r t n e r e q u i t y + E n d i n g P a r t n e r e q u i t y ) 2 To determine: The partner return on equity for each partner and partnership

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Answer 1

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Definition Definition Arrangement between two or more people whereby they agree to manage business operations and share its profits and losses in an agreed ratio. The agreement drafted and signed by the partners of the firm is termed as a partnership deed and contains various important clauses agreed between the partners such as profit/loss sharing, interest on capital, remuneration allocation of each partner, and drawings of a partner.

Chapter 12, Problem 8QS

To determine

Concept introduction:

Partnership: Partnership is one of the types of business origination. Under the partnership, two or more individuals agree to form a business together and share losses and profits in the predetermined ratio.

Partner Return on equity: Partner Return on equity is the profitability measure to determine the % of return earned on the partner’s investment in the partnership. Partner Return on equity is calculated by dividing the Partner net income by Average Partner equity. The formula to calculate Partner Return on equity is as follows:

$P a r t n e r R e t u r n o n e q u i t y = \frac{P a r t n e r n e t i n c o m e}{A v e r a g e P a r t n e r e q u i t y}$

The formula to calculate the Average Partner equity is as follows:

$A v e r a g e P a r t n e r e q u i t y = \frac{(B e g i n n i n g P a r t n e r e q u i t y + E n d i n g P a r t n e r e q u i t y)}{2}$

To determine: The partner return on equity for each partner and partnership

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K Sunlight Design Corporation sells glass vases at a wholesale price of $3.50 per unit. The variable cost to manufacture is $1.75 per unit. The monthly fixed costs are $7,500. Its current sales are 27,000 units per month. If the company wants to increase its operating income by 30%, how many additional units must it sell? (Round any intermediate calculations to two decimal places and your final answer up to the nearest whole unit.) A. 7,500 glass vases OB. 33,815 glass vases OC. 6,815 glass vases D. 94,500 glass vases

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Answer 2

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Definition Definition Arrangement between two or more people whereby they agree to manage business operations and share its profits and losses in an agreed ratio. The agreement drafted and signed by the partners of the firm is termed as a partnership deed and contains various important clauses agreed between the partners such as profit/loss sharing, interest on capital, remuneration allocation of each partner, and drawings of a partner.

Chapter 12, Problem 8QS

To determine

Concept introduction:

Partnership: Partnership is one of the types of business origination. Under the partnership, two or more individuals agree to form a business together and share losses and profits in the predetermined ratio.

Partner Return on equity: Partner Return on equity is the profitability measure to determine the % of return earned on the partner’s investment in the partnership. Partner Return on equity is calculated by dividing the Partner net income by Average Partner equity. The formula to calculate Partner Return on equity is as follows:

$P a r t n e r R e t u r n o n e q u i t y = \frac{P a r t n e r n e t i n c o m e}{A v e r a g e P a r t n e r e q u i t y}$

The formula to calculate the Average Partner equity is as follows:

$A v e r a g e P a r t n e r e q u i t y = \frac{(B e g i n n i n g P a r t n e r e q u i t y + E n d i n g P a r t n e r e q u i t y)}{2}$

To determine: The partner return on equity for each partner and partnership

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 3

Question

Definition Definition Arrangement between two or more people whereby they agree to manage business operations and share its profits and losses in an agreed ratio. The agreement drafted and signed by the partners of the firm is termed as a partnership deed and contains various important clauses agreed between the partners such as profit/loss sharing, interest on capital, remuneration allocation of each partner, and drawings of a partner.

Chapter 12, Problem 8QS

To determine

Concept introduction:

Partnership: Partnership is one of the types of business origination. Under the partnership, two or more individuals agree to form a business together and share losses and profits in the predetermined ratio.

Partner Return on equity: Partner Return on equity is the profitability measure to determine the % of return earned on the partner’s investment in the partnership. Partner Return on equity is calculated by dividing the Partner net income by Average Partner equity. The formula to calculate Partner Return on equity is as follows:

$P a r t n e r R e t u r n o n e q u i t y = \frac{P a r t n e r n e t i n c o m e}{A v e r a g e P a r t n e r e q u i t y}$

The formula to calculate the Average Partner equity is as follows:

$A v e r a g e P a r t n e r e q u i t y = \frac{(B e g i n n i n g P a r t n e r e q u i t y + E n d i n g P a r t n e r e q u i t y)}{2}$

To determine: The partner return on equity for each partner and partnership

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 4

Question

Definition Definition Arrangement between two or more people whereby they agree to manage business operations and share its profits and losses in an agreed ratio. The agreement drafted and signed by the partners of the firm is termed as a partnership deed and contains various important clauses agreed between the partners such as profit/loss sharing, interest on capital, remuneration allocation of each partner, and drawings of a partner.

Chapter 12, Problem 8QS

To determine