Need to fill out the spreadsheet! I will be sure to give a thumbs up
1. Ahmed and Ali are partners in a small business. Their partnership agreement states that net income is divided based on annual salaries of $20 000 for Ahmed and $25 000 for Ali, and an income ratio of 3:2. Calculate the net income allocation and record the journal entry, based on the following unrelated situations: (a) net income of $100 000 (b) net loss of $4 000. 2. Business partners Baliva, Masi, and Romalati have a partnership agreement that outlines a detailed formula for sharing profits and losses. Baliva, Masi, and Romalati earn annual salaries of $60 000, $70 000, and $80 000 respectively. They also earn a fixed percentage of interest on their capital balances which are $50 000, $50 000, and $70 000 respectively. Any remaining income is allocated using an income ratio of 30%, 30% and 40% respectively. Calculate the net income allocation and record the journal entry under the following unrelated situations: (a) net income of $400 000, and 7% on capital balances (b) net income of $50 000, and 5% on capital balances. A B D E E F G H J L 1 General Journal Particulars Page Credit 2 Date Debit Ahmed Ali Total 3 a) 4 5 6 7 CALCULATIONS (a) Income Ratio Net Income Income Distribution Salary Net Income allocated PRIOR to ratio application Net Income to be allocated based on Income ratio Share of income based on income ratio Total allocation of net income 8 b) 9 10 11 12 Ahmed Ali Total 13 14 15 16 (b) Income Ratio Net Loss Income Distribution Salary Net Income allocated PRIOR to ratio application Net Income to be allocated based on income ratio Share of income based on income ratio Total allocation of net income 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 A B D E F G 1 j K M 1 General Journal Particulars Page Credit 2 Date Debit Ballya Masl Romalati Total 3 al 4 5 6 H CALCULATIONS Scenario (a) Balance in Capital account, January 1 Income Ratio Net Income Income Distribution Salary Interest Allowance Net Income allocated PRIOR to ratio application Net Income to be allocated based on income ratio Share of income based on income ratio Total allocation of net income 7 8 8 9 b) 10 11 12 13 Baliva Masi Romalati Total Scenario (b) Balance in Capital acoount, January 1 Income Ratio Net Income Income Distribution Salary Interest Allowance Net Income allocated PRIOR to ratio application Net Income to be allocated based on Income ratio Share of income based on income ratio Total allocation of net income 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43
