Tri Fecta, a partnership, had revenues of $379,000 in its first
year of operations. The partnership has not collected on $45,100 of
its sales and still owes $38,300 on $165,000 of merchandise it
purchased. There was no inventory on hand at the end of the year.
The partnership paid $28,700 in salaries. The partners invested
$46,000 in the business and $24,000 was borrowed on a five-year
note. The partnership paid $1,920 in interest that was the amount
owed for the year and paid $9,800 for a two-year insurance policy
on the first day of business.
Compute net income for the first year for Tri Fecta.
Multiple Choice
$ 254,420
$ 178,480
$ 185,300
$ 214,000
Ans: $178,480
Working:
l l
Particulars Amount$
Sales $379,000
less: cost of goods sold $165,000
Gross profit $214,000
less: Salaries expense $28,700
Interest expense $1,920
Insurance policy $4,900
Net income $178,480
Note:
1) Insurance policy is for two year s so for one year $9,800/2=$4,900
2) for computing Net income cash Receipt and payment is not Necessary so fallow Accrual Basis
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Tri
Fecta, a partnership, had revenues of $374,000 in its first year of
operations. The partnership has not collected on $45,200 of its
sales and still owes $39,000 on $185,000 of merchandise it
purchased.
please give explanation
33 33333333 Tri Fecta, a partnership, had revenues of $374,000 in its first year of operations. The partnership has not collected on $45,200 of its sales and still owes $39.000 on $185,000 of merchandise it purchased. There was no inventory on hand at...
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