Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Butler and John operate a music store as a partnership. The partnership agreement states that profits and losses are to be shared equally after adjusting

Butler and John operate a music store as a partnership. The partnership agreement states that profits and losses are to be shared equally after adjusting for interest on capital, superannuation, drawings and salaries paid to the partners

Income ($)

Sales

$896,900

Interest from Advance to John

2,000

Expenses ($)

Cost of goods sold

416,000

Salary-Butler

63,000

Salary-employees

110,000

Superannuation to Butler

14,000

Superannuation to employees

13,000

Interest on capital to Butler

7,000

Interest on Capital to John

9,500

Interest on loan from CBA

19,000

Drawings to Butler

32,000

Drawings to John

17,000

Other deductible operating expenses

105,000

Additional information:

Trading stock balances were estimated as follows:

30 June 2019 86,000

30 June 2020 94,000

Required:

Calculate the net income of the partnership. Show the allocation of net income to each of the partners.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Basel III, The Devil And Global Banking

Authors: D. Chorafas

2nd Edition

0230353770, 9780230353770

More Books

Students also viewed these Accounting questions

Question

What are the objectives of Human resource planning ?

Answered: 1 week ago

Question

Explain the process of Human Resource Planning.

Answered: 1 week ago