Answer-
Jones | Silva | Thompson | |
1. Income (Loss) allocation | $44210 | $18690 | $37200 |
2. Income (Loss) allocation | $23650 | ($1870) | $16640 |
3. Income (Loss) allocation | $6000 | ($19520) | ($1010) |
Calculation:
1.
Jones | Silva | Thompson | Total | |
Interest | $4010 | $2490 | $3000 | $9500 |
Salary | $24000 | $0 | $18000 | $42000 |
Total | $28010 | $2490 | $21000 | $51500 |
Remainder | $16200 | $16200 | $16200 | $48600 |
Income allocation | $44210 | $18690 | $37200 | $100100 |
Interest and Salary:
As per given information, 10% interest on beginning capital balance.
Jones (Interest) = 40100 * 10% = $4010
Silva (Interest) = 24900 * 10% = $2490
Thompson (Interest) = 30000 * 10% = $3000
Total interest allocate = $4010 + $2490 + $3000 = $9500
And monthly salary allowances of $2000 to Jones and $1500 to Thompson
Salary (12 months)
Jones = $2000 * 12 months = $24000
Thompson = $1500 * 12 months = $18000
Total salary allocate = $24000 + $18000 = $42000
Now,
Remainder:
= Net income - [Total interest allocate + Total salary allocate]
= $100100 - [$9500 + $42000]
= $48600
Allocate remainder equally between all three partners
Jones (Remainder) = $48600 / 3 = $16200
Silva (Remainder) = $48600 / 3 = $16200
Thompson (Remainder) = $48600 / 3 = $16200
Income Allocation:
Jones = Interest + Salary + Remainder income
= $4010 + $24000 + $16200
= $44210
Silva = Interest + Salary + Remainder income
= $2490 + $0 + $16200
= $18690
Thompson = Interest + Salary + Remainder income
= $3000 + $18000 + $16200
= $37200
2.
Jones | Silva | Thompson | Total | |
Interest | $4010 | $2490 | $3000 | $9500 |
Salary | $24000 | $0 | $18000 | $42000 |
Total | $28010 | $2490 | $21000 | $51500 |
Remainder | ($4360) | ($4360) | ($4360) | ($13080) |
Income (Loss) allocation | $23650 | ($1870) | $16640 | $38420 |
Interest and Salary:
As per given information, 10% interest on beginning capital balance.
Jones (Interest) = 40100 * 10% = $4010
Silva (Interest) = 24900 * 10% = $2490
Thompson (Interest) = 30000 * 10% = $3000
Total interest allocate = $4010 + $2490 + $3000 = $9500
And monthly salary allowances of $2000 to Jones and $1500 to Thompson
Salary (12 months)
Jones = $2000 * 12 months = $24000
Thompson = $1500 * 12 months = $18000
Total salary allocate = $24000 + $18000 = $42000
Now,
Remainder:
= Net income - [Total interest allocate + Total salary allocate]
= $38420 - [$9500 + $42000]
= ($13080)
Allocate remainder equally between all three partners
Jones (Remainder) = ($13080) / 3 = ($4360)
Silva (Remainder) = ($13080) / 3 = ($4360)
Thompson (Remainder) = ($13080) / 3 = ($4360)
Income Allocation:
Jones = Interest + Salary + Remainder income
= $4010 + $24000 + ($4360)
= $23650
Silva = Interest + Salary + Remainder income
= $2490 + $0 + ($4360)
= ($1870)
Thompson = Interest + Salary + Remainder income
= $3000 + $18000 + ($4360)
= $16640
3.
Jones | Silva | Thompson | Total | |
Interest | $4010 | $2490 | $3000 | $9500 |
Salary | $24000 | $0 | $18000 | $42000 |
Total | $28010 | $2490 | $21000 | $51500 |
Remainder | ($22010) | ($22010) | ($22010) | ($66030) |
Income (Loss) allocation | $6000 | ($19520) | ($1010) | ($14530) |
Interest and Salary:
As per given information, 10% interest on beginning capital balance.
Jones (Interest) = 40100 * 10% = $4010
Silva (Interest) = 24900 * 10% = $2490
Thompson (Interest) = 30000 * 10% = $3000
Total interest allocate = $4010 + $2490 + $3000 = $9500
And monthly salary allowances of $2000 to Jones and $1500 to Thompson
Salary (12 months)
Jones = $2000 * 12 months = $24000
Thompson = $1500 * 12 months = $18000
Total salary allocate = $24000 + $18000 = $42000
Now,
Remainder:
= Net loss - [Total interest allocate + Total salary allocate]
= ($14530) - [$9500 + $42000]
= ($66030)
Allocate remainder equally between all three partners
Jones (Remainder) = ($66030) / 3 = ($22010)
Silva (Remainder) = ($66030) / 3 = ($22010)
Thompson (Remainder) = ($66030) / 3 = ($22010)
Income Allocation:
Jones = Interest + Salary + Remainder income
= $4010 + $24000 + ($22010)
= $6000
Silva = Interest + Salary + Remainder income
= $2490 + $0 + ($22010)
= ($19520)
Thompson = Interest + Salary + Remainder income
= $3000 + $18000 + ($22010)
= ($1010)
Exercise 15-3 Jones, Silva, and Thompson form a partnership and agree to allocate income equally after...
Exercise 15-3
Jones, Silva, and Thompson form a partnership and agree to allocate
income equally after recognition of 10% interest on beginning
capital balances and monthly salary allowances of $2,010 to Jones
and $1,480 to Thompson. Capital balances on January 1 were as
follows:
Jones
$39,700
Silva
25,000
Thompson
29,900
Calculate the net income (loss) allocation to each partner under
each of the following independent situations.
1.
Net income for the year is $99,040.
2.
Net income for the year...
Exercise 16-3
The unsuccessful partnership of the Jones Brothers is about to
undergo liquidation. They have asked you to estimate the amount of
cash that each brother will receive. They share profits and losses
equally.
Cash
$23,000
Liabilities
$32,000
Noncash Assets
102,000
Doug, Capital
53,000
Dave, Capital
46,000
Dan, Capital
(6,000
)
$125,000
$125,000
Both Doug and Dave are personally solvent, but Dan is not. They
estimate that they will receive $54,000 from the sale of the
noncash assets.
Prepare...
Exercise 16-3
Your answer is partially correct. Try again.
The unsuccessful partnership of the Jones Brothers is about to
undergo liquidation. They have asked you to estimate the amount of
cash that each brother will receive. They share profits and losses
equally.
Cash
$23,000
Liabilities
$32,000
Noncash Assets
102,000
Doug, Capital
53,000
Dave, Capital
46,000
Dan, Capital
(6,000
)
$125,000
$125,000
Both Doug and Dave are personally solvent, but Dan is not. They
estimate that they will receive $54,000 from...
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