PROBLEM 15-1 Profit Allocation Day and Night formed an accounting partnership in 2014. Capital transactions for...
PROBLEM 15-1 Profit Allocation
Day and Night formed an accounting partnership in 2014. Capital transactions for Day and Night during 2014 are
as follows:
Date Transaction Amount
Day
1/1 Beginning balance $75,000
4/1 Withdrawal 18,750
6/1 Investment 37,500
11/1 Investment 18,750
Night
1/1 Beginning balance $37,500
7/1 Investment 18,750
10/1 Withdrawal 9,375
Partnership net income for the year ended December 31, 2014; is $68,400 before considering salaries or interest.
Required:
Determine the amount of profit that is to be allocated to Day and Night in accordance with each of the following
independent profit-sharing agreements:
1. Day and Night failed to provide a profit-sharing arrangement in the articles of partnership and fail to compromise
on an agreement.
2. Net income is to be allocated 60% to Day and 40% to Night.
3. Net income is to be allocated in the ratio of ending capital balances.
4. Net income is to be allocated in the ratio of average capital balances.
5. Interest of 15% is to be granted on average capital balances, salaries of $15,000 and $8,250 are to be allocated
to Day and Night, respectively, and the remainder is to be divided equally.
Please can you help me with Question number #5. Thank you.
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PROBLEM 15-1 Profit Allocation
Day and Night formed an accounting partnership in 2014. Capital
transactions for...
Day and Night formed an accounting partnership in 2014. Capital transactions for Day and Night during...
Day and Night formed an accounting partnership in 2014. Capital transactions for Day and Night during 2014 are as follows: Date Transaction Amount Day 1/1 Beginning balance $75,000 4/1 Withdrawal 19,200 6/1 Investment 37,800 11/1 Investment 19,200 Night 1/1 Beginning balance $37,200 7/1 Investment 18,600 10/1 Withdrawal 9,600 Partnership net income for the year ended December 31, 2014; is $69,000 before considering salaries or interest. Determine the amount of profit that is to be allocated to Day and Night in...
Day and Night formed an accounting partnership in 2014. Capital transactions for Day and Night during...
Day and Night formed an accounting partnership in 2014. Capital transactions for Day and Night during 2014 are as follows: Transaction Date Amount Day 1/1 Beginning balance $75,000 19,200 37,800 Withdrawal 4/1 6/1 Investment 11/1 Investment 19,200 Night 1/1 Beginning balance $37,800 7/1 Investment 19,200 10/1 Withdrawal 9,000 Partnership net income for the year ended December 31, 2014; is $69,000 before considering salaries or interest. Determine the amount of profit that is to be allocated to Day and Night in...
68. Which of the following statements is false? Partners may contribute additional capital to the partnership...
68. Which of the following statements is false? Partners may contribute additional capital to the partnership in the form of cash and other assets Withdrawals of cash by the partners are called "drawings." The partnership income statement includes revenues and expenses but not salary paid to partners A) B) C) D) All of the above are true 69. Which of the following statements about the allocation of partnership profit or loss is false? A) Partnership agreements sometimes allow for a...
C. Eastwood. A North, and M. West are manufacturers' representatives in the architecture business. Their capital...
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McGill and Smyth have capital balances on January 1 of $60,000
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Exercise 15-5
On January 1, 2016, Tony and Jon formed T&J Personal
Financial Planning with capital investments of $482,900 and
$339,900, respectively. The partners wanted to draft a profit and
loss agreement that would reward each individual for the resources
invested in the partnership. Accordingly, the partnership agreement
provides that profits are to be allocated as follows:
1.
Annual salaries of $41,400 and $65,100 are granted to Tony and
Jon, respectively.
2.
In addition to the salary, Jon is entitled...
C. Eastwood, A. North, and M. West are manufacturers’ representatives in the architecture business. Their capital accoun...
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McGill and Smyth have capital balances on January 1 of $60,000 and $48,000, respectively. The partnership...
McGill and Smyth have capital balances on January 1 of $60,000
and $48,000, respectively. The partnership income-sharing agreement
provides for (1) annual salaries of $16,000 for McGill and $20,000
for Smyth, (2) interest at 10% on beginning capital balances, and
(3) remaining income or loss to be shared 60% by McGill and 40% by
Smyth.
Please fill out the incorrect chart.
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Adam, Bella, and Chris operate a partnership with a complex profit and loss sharing agreement. The...
Adam, Bella, and Chris operate a partnership with a complex profit and loss sharing agreement. The average capital balance for Adam, Bella and Chris on December 31, 2018 is $120,000, $270,000, and $340,000, respectively. If partnership net income is above $160,000, after the salary allocations are considered (but before the interest allocations are considered), Chris will receive a bonus of 10% of the income (before deducting salary and interest, but after deducting the bonus). A 6% interest allocation is provided...
DIVISION OF PARTNERSHIP EARNINGS profit-and-loss ratio. ATKINS, CAPITAL Date Debit Credit Balance Jan. 1 Balance ....
DIVISION OF PARTNERSHIP EARNINGS profit-and-loss ratio. ATKINS, CAPITAL Date Debit Credit Balance Jan. 1 Balance . . . . . . . . . . . . . $162,000 $162,000 July 1 Additional Investment . . . 50,000 212,000 Sept. 3 Permanent reduction . . . . $30,000 $182,000 BRILL, CAPITAL Date Debit Credit Balance Jan. 1 Balance . . . . . . . . . . . . . $126,000 $126,000 COREY, CAPITAL Date Debit Credit Balance Jan....
Day and Night formed an accounting partnership in 2014. Capital transactions for Day and Night during 2014 are as follows: Transaction Date Amount Day 1/1 Beginning balance $75,000 19,200 37,800 Withdrawal 4/1 6/1 Investment 11/1 Investment 19,200 Night 1/1 Beginning balance $37,800 7/1 Investment 19,200 10/1 Withdrawal 9,000 Partnership net income for the year ended December 31, 2014; is $69,000 before considering salaries or interest. Determine the amount of profit that is to be allocated to Day and Night in...
68. Which of the following statements is false? Partners may contribute additional capital to the partnership in the form of cash and other assets Withdrawals of cash by the partners are called "drawings." The partnership income statement includes revenues and expenses but not salary paid to partners A) B) C) D) All of the above are true 69. Which of the following statements about the allocation of partnership profit or loss is false? A) Partnership agreements sometimes allow for a...
C. Eastwood. A North, and M. West are manufacturers' representatives in the architecture business. Their capital accounts in the ENW partnership for 20X1 were as follows: C. Eastwood, Capital 9/1 9,300 1/11 30.400 7,500 A North, Capital 3/1 9.400 1/1 7/1 9/1 40,600 6,500 5.700 M. West, Capital 8/1 13,700 1/1 4/1 6/1 50,600 8,500 4.400 Required: For each of the following independent income-sharing agreements, prepare an income distribution schedule a. Salaries are $16.200 to Eastwood, $21,800 to North and...
McGill and Smyth have capital balances on January 1 of $60,000
and $48,000, respectively. The partnership income-sharing agreement
provides for (1) annual salaries of $16,000 for
McGill and $20,000 for Smyth, (2) interest at 10% on beginning
capital balances, and (3) remaining income or loss to be shared 60%
by McGill and 40% by Smyth.
Exercise 12-04 a-b (Part Level Submission) (Video) McGill and Smyth have capital balances on January 1 of $60,000 and $48,000, respectively. The partnership income-sharing agreement...
Exercise 15-5
On January 1, 2016, Tony and Jon formed T&J Personal
Financial Planning with capital investments of $482,900 and
$339,900, respectively. The partners wanted to draft a profit and
loss agreement that would reward each individual for the resources
invested in the partnership. Accordingly, the partnership agreement
provides that profits are to be allocated as follows:
1.
Annual salaries of $41,400 and $65,100 are granted to Tony and
Jon, respectively.
2.
In addition to the salary, Jon is entitled...
McGill and Smyth have capital balances on January 1 of $60,000
and $48,000, respectively. The partnership income-sharing agreement
provides for (1) annual salaries of $16,000 for McGill and $20,000
for Smyth, (2) interest at 10% on beginning capital balances, and
(3) remaining income or loss to be shared 60% by McGill and 40% by
Smyth.
Please fill out the incorrect chart.
McGill and Smyth have capital balances on January 1 of $60,000 and $48,000, respectively. The partnership income-sharing agreement provides...
Adam, Bella, and Chris operate a partnership with a complex profit and loss sharing agreement. The average capital balance for Adam, Bella and Chris on December 31, 2018 is $120,000, $270,000, and $340,000, respectively. If partnership net income is above $160,000, after the salary allocations are considered (but before the interest allocations are considered), Chris will receive a bonus of 10% of the income (before deducting salary and interest, but after deducting the bonus). A 6% interest allocation is provided...
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