purfect spa and doggy daycare

With the increased daycare customers and production of treats, Genevieve decided to hire someone to help with the workload.

Ben Jones was hired on August 11, 2023. His regular hourly wage rate is $17.50, and he is paid time-and-a-half for work over 40 hours per week. Ben will have $2 per week withheld for a donation to Ally Animal Shelter, and the company will match the donation. Purrfect Spa and Doggy Daycare accrues vacation pay at a rate of 4%.

In the pay period ended August 18, 2023, Ben worked 44 hours.

Genevieve asks you to help her calculate Ben's gross and net pay and then record the August 18 payroll. Use the 2022 rates and exemptions from the Canada Revenue Agency website to calculate CPP and EI deductions. For his income tax deduction, use 17%.

Genevieve is also unsure of any costs that the company has to pay in relation to Bens payroll. She asks you to record any employee benefits.

A remittance form from Canada Revenue Agency was delivered in the mail. The form has a September 15, 2023 due date. Genevieve is wondering what needs to be paid on this remittance from the August 18, 2023 payroll and what the journal entry would be.

Purrfect Spa and Doggy Daycare has been very busy and Genevieve is very happy that she found Ben to help her. Genevieve and Ben have become a very efficient team.

While talking over coffee, they started discussing expanding the pet treat part of the business by selling the treats to pet stores throughout the city. With the increased role that Ben would play in this expansion, Genevieve and Ben started thinking about forming a partnership. They are both new to the partnership form of business but know that they would like some kind of documentation that states the agreed-upon set up of the business. Genevieve asks you what kind of information should be included on their partnership agreement.

Genevieve and Ben decide to form a partnership. Genevieve has $48,000 in her Capital account and nothing in her Drawings account. Ben has $15,000 of cash to invest in the partnership. Because they are going to deliver the pet treats to the pet stores, Ben is also investing his van into the partnership. The fair value of the van is $31,000 and the partnership is going to take over the $14,000 bank loan that Ben still has on the van. Genevieve and Ben agree that Ben will receive 45% ownership of the company. The partnership will start January 1, 2024 and will have a December 31 year-end. Genevieve has asked you to record the journal entry to form the partnership.

The partnership reports a $30,000 profit at year-end December 31, 2024. Genevieve and Ben agree to share profit and losses by allocating yearly salary allowance of $30,000 for Genevieve and $20,000 for Ben, an interest allowance of 10% based on initial capital balances, and to split the remainder 50/50. They came up with this agreement but are now unsure how to complete the calculations. They ask you to make a report showing the details of the division of the profit and to record the December 31, 2024 journal entry to record the division of the profit.

Genevieve has a friend, Larry, who owns a coffee roasting business. Early in 2022, Larry asked Genevieve for some help with the accounting for his business. Because Larrys business is set up as a private corporation, Genevieve could not help him. Genevieve asked if you could help Larry with his questions and, because there are a few more topics to cover in this case, you said, Sure!