Question
Aggrey, Bobby and Charlie run a partnership business called ABC enterprises. They share profits and losses in the ratio 3:1:1. During the year 2021, the
Aggrey, Bobby and Charlie run a partnership business called ABC enterprises. They share profits and losses in the ratio 3:1:1. During the year 2021, the partnership reported a profit of ksh 2,200,000 after including interest on partners drawings and expensing partners salaries as follows:
Interest on drawings by partners:
Aggrey ksh 460,000
Bobby ksh 280,000
Partners salaries:
Bobby ksh 640,000
Charlie ksh 820,000
The partners were each to be paid a commission which had not been charged in the above income as follows:
Aggrey ksh 160,000
Bobby ksh 200,000
Charlie ksh 320,000
Required:
Compute the taxable income of each partner for the year 2021.
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