Accounting for allocation of income among partners: The Accounting forallocation of income among partners shall be initiated through preparation of statement which reflects the allocation of income. The partnership agreement may provide for salary, interest and sharing ratio. In such cases, firstly allowance for salary shall be provided among the partners and then interest shall be allocated among the partners on the basis of rate and capital balances of partners in the beginning of the year. The net amount remaining shall be distributed among the partners on the basis of sharing ratio. The total share of income shall be computed by adding up all the three components as mentioned above for each respective partners and then entry is made by debiting the income summary and crediting the partners capital account for the respective amount of share of total profits. Requirement1: TheStatement showing the allocation of loss.

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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 E12.17E

To determine

Accounting for allocation of income among partners:

The Accounting forallocation of income among partners shall be initiated through preparation of statement which reflects the allocation of income. The partnership agreement may provide for salary, interest and sharing ratio. In such cases, firstly allowance for salary shall be provided among the partners and then interest shall be allocated among the partners on the basis of rate and capital balances of partners in the beginning of the year. The net amount remaining shall be distributed among the partners on the basis of sharing ratio.

The total share of income shall be computed by adding up all the three components as mentioned above for each respective partners and then entry is made by debiting the income summary and crediting the partners capital account for the respective amount of share of total profits.

Requirement1:

TheStatement showing the allocation of loss.

To determine

Requirement2:

The Statement showing the allocation of income.

To determine

Requirement3:

The Statement showing the allocation of income.

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Brun Company produces its product through two processing departments: Mixing and Baking. Information for the Mixing department follows. Direct Materials Conversion Unit Percent Complete Percent Complete Beginning work in process inventory 7.500 Units started this period 104,500 Units completed and transferred out 100.000 Ending work in process inventory 12.000 100% 25% Beginning work in process inventory Direct materials Conversion $6.800 14.500 $21.300 Costs added this period Drect materials 116,400 Conversion Total costs to account for 1.067,000 1.183.400 $1.204.700 Required 1. Prepare the Mixing department's production cost report for November using the weighted average method Check (1) C$1.000 2. Prepare the November 30 journal entry to transfer the cost of completed units from Mixing to Baking

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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 E12.17E

To determine

Accounting for allocation of income among partners:

The Accounting forallocation of income among partners shall be initiated through preparation of statement which reflects the allocation of income. The partnership agreement may provide for salary, interest and sharing ratio. In such cases, firstly allowance for salary shall be provided among the partners and then interest shall be allocated among the partners on the basis of rate and capital balances of partners in the beginning of the year. The net amount remaining shall be distributed among the partners on the basis of sharing ratio.

The total share of income shall be computed by adding up all the three components as mentioned above for each respective partners and then entry is made by debiting the income summary and crediting the partners capital account for the respective amount of share of total profits.

Requirement1:

TheStatement showing the allocation of loss.

To determine

Requirement2:

The Statement showing the allocation of income.

To determine

Requirement3:

The Statement showing the allocation of income.

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Answer 3

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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 E12.17E

To determine

Accounting for allocation of income among partners:

The Accounting forallocation of income among partners shall be initiated through preparation of statement which reflects the allocation of income. The partnership agreement may provide for salary, interest and sharing ratio. In such cases, firstly allowance for salary shall be provided among the partners and then interest shall be allocated among the partners on the basis of rate and capital balances of partners in the beginning of the year. The net amount remaining shall be distributed among the partners on the basis of sharing ratio.

The total share of income shall be computed by adding up all the three components as mentioned above for each respective partners and then entry is made by debiting the income summary and crediting the partners capital account for the respective amount of share of total profits.

Requirement1:

TheStatement showing the allocation of loss.

To determine

Requirement2:

The Statement showing the allocation of income.

To determine

Requirement3:

The Statement showing the allocation of income.

Expert Solution & Answer

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Check out a sample textbook solution

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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 E12.17E

To determine