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4. Ekin and Qiqi are partners. Their business accounts show a net loss of RM72,000 for the year ended 30 September 2020. Business expenses
4. Ekin and Qiqi are partners. Their business accounts show a net loss of RM72,000 for the year ended 30 September 2020. Business expenses include: RM Depreciation 2,500 Entertainment of clients 1,800 Donations 1,000 of which RM800 was donated to approved charities. The partnership agreement provides for an annual salary of RM18,000 to Ekin, RM24,000 to Qiqi and interest on capital of RM900 to Ekin. The profit sharing ratio is 70% to Ekin and 30% to Qiqi. Capital allowances for YA 2020 amount to RM2,200. Ekin has rental income (adjusted) of RM15,600 for the year ending 31 December 2020. Required; a) Compute the adjusted income/loss and divisible income/loss of the partnership for the year ended 30 September 2020. b) Compute the total income of Ekin and Qiqi for YA 2020 showing the allocation of capital allowances and donations from the partnership.
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