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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Partnership Entries and Statement of Partnership Equity The capital accounts of Lorraine Grecco and Carrie Rosenfeld have balances of $64,000 and $99,000, respectively, on January 1, 20Y4, the beginning of the fiscal year. On March 10, Grecco invested an additional $11,000. During the year, Grecco and Rosenfeld withdrew $43,000 and $53,000, respectively, and net income for the year was $84,000. Revenues were $654,000, and expenses were $570,000. The articles of partnership make no reference to the division of net income. a. Journalize the entry to close the revenues and expenses. If an amount box does not require an entry, leave it blank. Journalize the entry to close the drawing accounts. If an amount box does not require an entry, leave it blank. b. Prepare a statement of partnership equity for the current year for the partnership of Grecco and Rosenfeld. If an amount is zero or a blank, enter in 0.

Dividing Partnership Income Beau Dawson and Willow McDonald formed a partnership, investing $116,000 and $174,000, respectively. Determine their participation in the year's net income of $107,000 under each of the following independent assumptions: Salary allowances of $36,000 and $47,000, respectively, and the balance divided equally. Allowance of interest at the rate of 5% on original investments, salary allowances of $36,000 and $47,000, respectively, and the remainder divided equally. Dawson McDonald 1. 1. 2. 2.

Partnership entries and statement of partnership equity The capital accounts of Hassan Khan and Dmitri Palovich have balances of $75,000 and $54,000, respectively, on January 1, 20Y4, the beginning of the fiscal year. On July 10, Khan invested an additional $8,000. During the year, Khan and Palovich withdrew $40,000 and $32,000, respectively, and net income for the year was $102,000. Revenues were $523,000, and expenses were $421,000. The articles of partnership make no reference to the division of net income. a. Journalize the entry to close the revenues and expenses. If an amount box does not require an entry, leave it blank. BE Journalize the entry to close the drawing accounts. If an amount box does not require an entry, leave it blank. EE b. Prepare a statement of partnership equity for the current year for the partnership of Khan and Palovich. If an amount is zero or a blank, enter in 0. Khan and Palovich Statement of Partnership Equity For the Year Ended December 31, 20Y4 Line…

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 14

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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