REQUIREMENTS:

Determine the share of Preach in the partnership profit assuming that profits are divided based on ending capital balances.

Determine the share of Witch in the partnership profit assuming that profits are divided based on average capital balances.

Preach and Witch are partners in their Circus Show business. Witch is the managing partner. As of December 31, 2020, their capital account showed the following: July 1 Preach, Capital P 15,000 P100,000 10,000 10,000 35,000 December 1 January 1 April 1 November 1 April 1 Witch, Capital P 30,000 P 150,000 35,000 50,000 65000 December 1 January 1 June 1 October 1 The partnership earned a modest profit of P120,000 for the year ending 2020