Question
The partnership of Rummel and Kang, Stonecutters, reported revenues of $133,000 and expenses of $41,000 on the year-end work sheet. The capital balances as of
The partnership of Rummel and Kang, Stonecutters, reported revenues of $133,000 and expenses of $41,000 on the year-end work sheet. The capital balances as of January 1, 20--, were $41,000 for C. Rummel and $25,000 for V. Kang. No additional investments were made during the year. As stated in their partnership agreement, after withdrawing salary allowances of $43,000 for Rummel and $34,000 for Kang, the partners each withdrew their full 10% interest allowances on their January 1 capital balances. No additional withdrawals were made. Any remaining net income is to be divided on a 60-40 basis.
Required:
1. | Prepare the lower portion of the income statement of the partnership for the year ended December 31, 20--, showing the division of the partnership net income for the year. |
2. | Prepare a statement of partners equity for the year ended December 31, 20--, and the partners equity section of the balance sheet on that date. |
3. | Prepare closing entries for the partnership as of December 31, 20--. (For simplicity, use the account titles Revenues for all revenues and Expenses for all expenses.) |
CHART OF ACCOUNTS | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Rummel and Kang, Stonecutters | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
General Ledger | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Amount Descriptions | |
Capital, January 1, 20-- | |
Capital, December 31, 20-- | |
Interest allowances | |
Net income | |
Net loss | |
Remaining income | |
Salary allowances | |
Total partners equity | |
Withdrawals (salary and interest) |
Prepare the lower portion of the income statement of the partnership for the year ended December 31, 20--, showing the division of the partnership net income for the year.
Income Statement Instructions.
Prepare a statement of partners equity for the year ended December 31, 20--.
Prepare the partners equity section of the balance sheet on December 31, 20--.
Prepare closing entries for the partnership as of December 31, 20--. (For simplicity, use the account titles Revenues for all revenues and Expenses for all expenses.
PLEASE FOLOW CHART OF ACCOUNTS.
Thank you!
Edit:
That is the whole exercise and I do not have any more information.
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