Allocation of profit and loss to partners: Allocation of profit and loss to partners will be in accordance with partnership agreement. If the entity does not have formal partnership agreement, section 401 of the UPA 1997 indicates that profit and losses are distributed equally among partners. Profit distributions are not included in the partnership’s income statement, but recorded directly into partner’s capital accounts, not treated as expense items. Partner’s capital account: the balance in capital account represents the partner’s share of partnership’s net assets. A partners initial investment and any subsequent capital contributions, share of profits and any withdrawals of capital are recorded in partner’s capital account. Each partner has one capital account, which usually has a credit balance, but may have a debit balance because partner’s share of loss and withdrawals exceeds the capital contribution and share in profits. A deficiency is usually eliminated by additional capital contributions. The preparation of income distribution schedule.

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Answer 1

Question

Chapter 15, Problem 15.4E

a.

To determine

Allocation of profit and loss to partners:Allocation of profit and loss to partners will be in accordance with partnership agreement. If the entity does not have formal partnership agreement, section 401 of the UPA 1997 indicates that profit and losses are distributed equally among partners. Profit distributions are not included in the partnership’s income statement, but recorded directly into partner’s capital accounts, not treated as expense items.

Partner’s capital account:the balance in capital account represents the partner’s share of partnership’s net assets. A partners initial investment and any subsequent capital contributions, share of profits and any withdrawals of capital are recorded in partner’s capital account. Each partner has one capital account, which usually has a credit balance, but may have a debit balance because partner’s share of loss and withdrawals exceeds the capital contribution and share in profits. A deficiency is usually eliminated by additional capital contributions.

The preparation of income distribution schedule.

b.

To determine

Allocation of profit and loss to partners: Allocation of profit and loss to partners will be in accordance with partnership agreement. If the entity does not have formal partnership agreement, section 401 of the UPA 1997 indicates that profit and losses are distributed equally among partners. Profit distributions are not included in the partnership’s income statement, but recorded directly into partner’s capital accounts, not treated as expense items.

Partner’s capital account: the balance in capital account represents the partner’s share of partnership’s net assets. A partners initial investment and any subsequent capital contributions, share of profits and any withdrawals of capital are recorded in partner’s capital account. Each partner has one capital account, which usually has a credit balance, but may have a debit balance because partner’s share of loss and withdrawals exceeds the capital contribution and share in profits. A deficiency is usually eliminated by additional capital contributions.

The preparation statement of partner’s capital.

c.

To determine

Allocation of profit and loss to partners: Allocation of profit and loss to partners will be in accordance with partnership agreement. If the entity does not have formal partnership agreement, section 401 of the UPA 1997 indicates that profit and losses are distributed equally among partners. Profit distributions are not included in the partnership’s income statement, but recorded directly into partner’s capital accounts, not treated as expense items.

Partner’s capital account: the balance in capital account represents the partner’s share of partnership’s net assets. A partners initial investment and any subsequent capital contributions, share of profits and any withdrawals of capital are recorded in partner’s capital account. Each partner has one capital account, which usually has a credit balance, but may have a debit balance because partner’s share of loss and withdrawals exceeds the capital contribution and share in profits. A deficiency is usually eliminated by additional capital contributions.

The preparation of income distribution schedule where salaries for A is $30,000 and J is $35,000

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MoonWear, Inc. offers an unconditional return policy. It normally expects 2.5% of sales at retail selling prices to be returned before the return period expires. Assuming that MoonWear records total sales of $12.5 million for the current period, what amount of net sales should it record for this period?

Answer 2

Question

Chapter 15, Problem 15.4E

a.

To determine

Allocation of profit and loss to partners:Allocation of profit and loss to partners will be in accordance with partnership agreement. If the entity does not have formal partnership agreement, section 401 of the UPA 1997 indicates that profit and losses are distributed equally among partners. Profit distributions are not included in the partnership’s income statement, but recorded directly into partner’s capital accounts, not treated as expense items.

Partner’s capital account:the balance in capital account represents the partner’s share of partnership’s net assets. A partners initial investment and any subsequent capital contributions, share of profits and any withdrawals of capital are recorded in partner’s capital account. Each partner has one capital account, which usually has a credit balance, but may have a debit balance because partner’s share of loss and withdrawals exceeds the capital contribution and share in profits. A deficiency is usually eliminated by additional capital contributions.

The preparation of income distribution schedule.

b.

To determine

Allocation of profit and loss to partners: Allocation of profit and loss to partners will be in accordance with partnership agreement. If the entity does not have formal partnership agreement, section 401 of the UPA 1997 indicates that profit and losses are distributed equally among partners. Profit distributions are not included in the partnership’s income statement, but recorded directly into partner’s capital accounts, not treated as expense items.

Partner’s capital account: the balance in capital account represents the partner’s share of partnership’s net assets. A partners initial investment and any subsequent capital contributions, share of profits and any withdrawals of capital are recorded in partner’s capital account. Each partner has one capital account, which usually has a credit balance, but may have a debit balance because partner’s share of loss and withdrawals exceeds the capital contribution and share in profits. A deficiency is usually eliminated by additional capital contributions.

The preparation statement of partner’s capital.

c.

To determine

Allocation of profit and loss to partners: Allocation of profit and loss to partners will be in accordance with partnership agreement. If the entity does not have formal partnership agreement, section 401 of the UPA 1997 indicates that profit and losses are distributed equally among partners. Profit distributions are not included in the partnership’s income statement, but recorded directly into partner’s capital accounts, not treated as expense items.

Partner’s capital account: the balance in capital account represents the partner’s share of partnership’s net assets. A partners initial investment and any subsequent capital contributions, share of profits and any withdrawals of capital are recorded in partner’s capital account. Each partner has one capital account, which usually has a credit balance, but may have a debit balance because partner’s share of loss and withdrawals exceeds the capital contribution and share in profits. A deficiency is usually eliminated by additional capital contributions.

The preparation of income distribution schedule where salaries for A is $30,000 and J is $35,000

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Answer 3

Question

Chapter 15, Problem 15.4E

a.

To determine

Allocation of profit and loss to partners:Allocation of profit and loss to partners will be in accordance with partnership agreement. If the entity does not have formal partnership agreement, section 401 of the UPA 1997 indicates that profit and losses are distributed equally among partners. Profit distributions are not included in the partnership’s income statement, but recorded directly into partner’s capital accounts, not treated as expense items.

Partner’s capital account:the balance in capital account represents the partner’s share of partnership’s net assets. A partners initial investment and any subsequent capital contributions, share of profits and any withdrawals of capital are recorded in partner’s capital account. Each partner has one capital account, which usually has a credit balance, but may have a debit balance because partner’s share of loss and withdrawals exceeds the capital contribution and share in profits. A deficiency is usually eliminated by additional capital contributions.

The preparation of income distribution schedule.

b.

To determine

Allocation of profit and loss to partners: Allocation of profit and loss to partners will be in accordance with partnership agreement. If the entity does not have formal partnership agreement, section 401 of the UPA 1997 indicates that profit and losses are distributed equally among partners. Profit distributions are not included in the partnership’s income statement, but recorded directly into partner’s capital accounts, not treated as expense items.

Partner’s capital account: the balance in capital account represents the partner’s share of partnership’s net assets. A partners initial investment and any subsequent capital contributions, share of profits and any withdrawals of capital are recorded in partner’s capital account. Each partner has one capital account, which usually has a credit balance, but may have a debit balance because partner’s share of loss and withdrawals exceeds the capital contribution and share in profits. A deficiency is usually eliminated by additional capital contributions.

The preparation statement of partner’s capital.

c.

To determine

Allocation of profit and loss to partners: Allocation of profit and loss to partners will be in accordance with partnership agreement. If the entity does not have formal partnership agreement, section 401 of the UPA 1997 indicates that profit and losses are distributed equally among partners. Profit distributions are not included in the partnership’s income statement, but recorded directly into partner’s capital accounts, not treated as expense items.

Partner’s capital account: the balance in capital account represents the partner’s share of partnership’s net assets. A partners initial investment and any subsequent capital contributions, share of profits and any withdrawals of capital are recorded in partner’s capital account. Each partner has one capital account, which usually has a credit balance, but may have a debit balance because partner’s share of loss and withdrawals exceeds the capital contribution and share in profits. A deficiency is usually eliminated by additional capital contributions.

The preparation of income distribution schedule where salaries for A is $30,000 and J is $35,000

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Answer 4

Question

Chapter 15, Problem 15.4E

a.

To determine

Allocation of profit and loss to partners:Allocation of profit and loss to partners will be in accordance with partnership agreement. If the entity does not have formal partnership agreement, section 401 of the UPA 1997 indicates that profit and losses are distributed equally among partners. Profit distributions are not included in the partnership’s income statement, but recorded directly into partner’s capital accounts, not treated as expense items.

Partner’s capital account:the balance in capital account represents the partner’s share of partnership’s net assets. A partners initial investment and any subsequent capital contributions, share of profits and any withdrawals of capital are recorded in partner’s capital account. Each partner has one capital account, which usually has a credit balance, but may have a debit balance because partner’s share of loss and withdrawals exceeds the capital contribution and share in profits. A deficiency is usually eliminated by additional capital contributions.

The preparation of income distribution schedule.

b.

To determine

Allocation of profit and loss to partners: Allocation of profit and loss to partners will be in accordance with partnership agreement. If the entity does not have formal partnership agreement, section 401 of the UPA 1997 indicates that profit and losses are distributed equally among partners. Profit distributions are not included in the partnership’s income statement, but recorded directly into partner’s capital accounts, not treated as expense items.

Partner’s capital account: the balance in capital account represents the partner’s share of partnership’s net assets. A partners initial investment and any subsequent capital contributions, share of profits and any withdrawals of capital are recorded in partner’s capital account. Each partner has one capital account, which usually has a credit balance, but may have a debit balance because partner’s share of loss and withdrawals exceeds the capital contribution and share in profits. A deficiency is usually eliminated by additional capital contributions.

The preparation statement of partner’s capital.

c.

To determine

Allocation of profit and loss to partners: Allocation of profit and loss to partners will be in accordance with partnership agreement. If the entity does not have formal partnership agreement, section 401 of the UPA 1997 indicates that profit and losses are distributed equally among partners. Profit distributions are not included in the partnership’s income statement, but recorded directly into partner’s capital accounts, not treated as expense items.

Partner’s capital account: the balance in capital account represents the partner’s share of partnership’s net assets. A partners initial investment and any subsequent capital contributions, share of profits and any withdrawals of capital are recorded in partner’s capital account. Each partner has one capital account, which usually has a credit balance, but may have a debit balance because partner’s share of loss and withdrawals exceeds the capital contribution and share in profits. A deficiency is usually eliminated by additional capital contributions.

The preparation of income distribution schedule where salaries for A is $30,000 and J is $35,000

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Answer 5

Chapter 15, Problem 15.4E

a.

To determine

Allocation of profit and loss to partners:Allocation of profit and loss to partners will be in accordance with partnership agreement. If the entity does not have formal partnership agreement, section 401 of the UPA 1997 indicates that profit and losses are distributed equally among partners. Profit distributions are not included in the partnership’s income statement, but recorded directly into partner’s capital accounts, not treated as expense items.

Partner’s capital account:the balance in capital account represents the partner’s share of partnership’s net assets. A partners initial investment and any subsequent capital contributions, share of profits and any withdrawals of capital are recorded in partner’s capital account. Each partner has one capital account, which usually has a credit balance, but may have a debit balance because partner’s share of loss and withdrawals exceeds the capital contribution and share in profits. A deficiency is usually eliminated by additional capital contributions.

The preparation of income distribution schedule.

b.

To determine

Allocation of profit and loss to partners: Allocation of profit and loss to partners will be in accordance with partnership agreement. If the entity does not have formal partnership agreement, section 401 of the UPA 1997 indicates that profit and losses are distributed equally among partners. Profit distributions are not included in the partnership’s income statement, but recorded directly into partner’s capital accounts, not treated as expense items.

Partner’s capital account: the balance in capital account represents the partner’s share of partnership’s net assets. A partners initial investment and any subsequent capital contributions, share of profits and any withdrawals of capital are recorded in partner’s capital account. Each partner has one capital account, which usually has a credit balance, but may have a debit balance because partner’s share of loss and withdrawals exceeds the capital contribution and share in profits. A deficiency is usually eliminated by additional capital contributions.

The preparation statement of partner’s capital.

c.

To determine

Allocation of profit and loss to partners: Allocation of profit and loss to partners will be in accordance with partnership agreement. If the entity does not have formal partnership agreement, section 401 of the UPA 1997 indicates that profit and losses are distributed equally among partners. Profit distributions are not included in the partnership’s income statement, but recorded directly into partner’s capital accounts, not treated as expense items.

Partner’s capital account: the balance in capital account represents the partner’s share of partnership’s net assets. A partners initial investment and any subsequent capital contributions, share of profits and any withdrawals of capital are recorded in partner’s capital account. Each partner has one capital account, which usually has a credit balance, but may have a debit balance because partner’s share of loss and withdrawals exceeds the capital contribution and share in profits. A deficiency is usually eliminated by additional capital contributions.

The preparation of income distribution schedule where salaries for A is $30,000 and J is $35,000

Answer 6

Chapter 15, Problem 15.4E

a.

To determine

Allocation of profit and loss to partners:Allocation of profit and loss to partners will be in accordance with partnership agreement. If the entity does not have formal partnership agreement, section 401 of the UPA 1997 indicates that profit and losses are distributed equally among partners. Profit distributions are not included in the partnership’s income statement, but recorded directly into partner’s capital accounts, not treated as expense items.

Partner’s capital account:the balance in capital account represents the partner’s share of partnership’s net assets. A partners initial investment and any subsequent capital contributions, share of profits and any withdrawals of capital are recorded in partner’s capital account. Each partner has one capital account, which usually has a credit balance, but may have a debit balance because partner’s share of loss and withdrawals exceeds the capital contribution and share in profits. A deficiency is usually eliminated by additional capital contributions.

The preparation of income distribution schedule.

Answer 7

Chapter 15, Problem 15.4E

a.

To determine

Allocation of profit and loss to partners:Allocation of profit and loss to partners will be in accordance with partnership agreement. If the entity does not have formal partnership agreement, section 401 of the UPA 1997 indicates that profit and losses are distributed equally among partners. Profit distributions are not included in the partnership’s income statement, but recorded directly into partner’s capital accounts, not treated as expense items.

Partner’s capital account:the balance in capital account represents the partner’s share of partnership’s net assets. A partners initial investment and any subsequent capital contributions, share of profits and any withdrawals of capital are recorded in partner’s capital account. Each partner has one capital account, which usually has a credit balance, but may have a debit balance because partner’s share of loss and withdrawals exceeds the capital contribution and share in profits. A deficiency is usually eliminated by additional capital contributions.

The preparation of income distribution schedule.

Answer 8

b.

To determine

Allocation of profit and loss to partners: Allocation of profit and loss to partners will be in accordance with partnership agreement. If the entity does not have formal partnership agreement, section 401 of the UPA 1997 indicates that profit and losses are distributed equally among partners. Profit distributions are not included in the partnership’s income statement, but recorded directly into partner’s capital accounts, not treated as expense items.

Partner’s capital account: the balance in capital account represents the partner’s share of partnership’s net assets. A partners initial investment and any subsequent capital contributions, share of profits and any withdrawals of capital are recorded in partner’s capital account. Each partner has one capital account, which usually has a credit balance, but may have a debit balance because partner’s share of loss and withdrawals exceeds the capital contribution and share in profits. A deficiency is usually eliminated by additional capital contributions.

The preparation statement of partner’s capital.

Answer 9

b.

To determine

Allocation of profit and loss to partners: Allocation of profit and loss to partners will be in accordance with partnership agreement. If the entity does not have formal partnership agreement, section 401 of the UPA 1997 indicates that profit and losses are distributed equally among partners. Profit distributions are not included in the partnership’s income statement, but recorded directly into partner’s capital accounts, not treated as expense items.

Partner’s capital account: the balance in capital account represents the partner’s share of partnership’s net assets. A partners initial investment and any subsequent capital contributions, share of profits and any withdrawals of capital are recorded in partner’s capital account. Each partner has one capital account, which usually has a credit balance, but may have a debit balance because partner’s share of loss and withdrawals exceeds the capital contribution and share in profits. A deficiency is usually eliminated by additional capital contributions.

The preparation statement of partner’s capital.

Answer 10

c.

To determine

Allocation of profit and loss to partners: Allocation of profit and loss to partners will be in accordance with partnership agreement. If the entity does not have formal partnership agreement, section 401 of the UPA 1997 indicates that profit and losses are distributed equally among partners. Profit distributions are not included in the partnership’s income statement, but recorded directly into partner’s capital accounts, not treated as expense items.

Partner’s capital account: the balance in capital account represents the partner’s share of partnership’s net assets. A partners initial investment and any subsequent capital contributions, share of profits and any withdrawals of capital are recorded in partner’s capital account. Each partner has one capital account, which usually has a credit balance, but may have a debit balance because partner’s share of loss and withdrawals exceeds the capital contribution and share in profits. A deficiency is usually eliminated by additional capital contributions.

The preparation of income distribution schedule where salaries for A is $30,000 and J is $35,000

Answer 11

c.

To determine

Allocation of profit and loss to partners: Allocation of profit and loss to partners will be in accordance with partnership agreement. If the entity does not have formal partnership agreement, section 401 of the UPA 1997 indicates that profit and losses are distributed equally among partners. Profit distributions are not included in the partnership’s income statement, but recorded directly into partner’s capital accounts, not treated as expense items.

Partner’s capital account: the balance in capital account represents the partner’s share of partnership’s net assets. A partners initial investment and any subsequent capital contributions, share of profits and any withdrawals of capital are recorded in partner’s capital account. Each partner has one capital account, which usually has a credit balance, but may have a debit balance because partner’s share of loss and withdrawals exceeds the capital contribution and share in profits. A deficiency is usually eliminated by additional capital contributions.

The preparation of income distribution schedule where salaries for A is $30,000 and J is $35,000

Answer 12

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Answer 13

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Answer 15

Ch. 15 - Prob. 15.1Q Ch. 15 - Prob. 15.2Q Ch. 15 - Prob. 15.3Q Ch. 15 - Prob. 15.4Q Ch. 15 - Under what circumstances would a partner’s capital...Ch. 15 - Prob. 15.6Q Ch. 15 - Prob. 15.7Q Ch. 15 - Prob. 15.8Q Ch. 15 - Prob. 15.9Q Ch. 15 - Prob. 15.10Q

Solution Summary: The author explains that the allocation of profit and loss to partners will be in accordance with partnership agreement.

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Chapter 15 Solutions