Question
PROBLEM 1-20 The following balance sheet for the Partnership of A, B, and C were taken from the books on July 1, 2019: Assets Cash
PROBLEM 1-20
The following balance sheet for the Partnership of A, B, and C were taken from the books on July 1, 2019:
Assets
Cash 40,000
Other Assets 360,000
TOTAL 400,000
Liabilities and Capital
Liabilities 100,000
A Capital 74,000
B Capital 130,000
C Capital 96,000
TOTAL 400,000
The partners agreed to distribute the profits as follows:
a.Annual salaries to A and B of P3,000 each.
b.Allow interest of 6% on beginning capital.
c.Allow a bonus of 10% to B, the bonus to be treated as an expense after salaries and interest.
d.Remaining, 40% to A, 40% to B, and 20% to C.
Required:
1.If the net income of the partnership was P122,000 during the six-month period ending December 32, 2019, the total share of B in the net income is:
2.If C receives as his hare of net income P42,880 for the six-month period ending December 31, 2019, the total net income realized by the partnership for the same period before salaries, interest and bonus was:
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started