None A partnership with four general partners: limits the active involvement in the firm to a single partner, limits each partner'spersonal liability to 25 percent of the partnership's total debt, distributes profits based on percentage of ownership, mustdistribute 25 percent of the profits to each partner, has an unlimited life.

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Answered: A partnership with four general…

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter15: Partnership Accounting

Section: Chapter Questions

Problem 1PB: The partnership of Magda and Sue shares profits and losses in a 50:50 ratio after Mary receives a...

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In a partnership firm there are two partners – X and Y. They share profit in the ratio of 55% and 45%. X contributed capital of OMR 180,000 and Y contributed OMR 160,000. Partnership Agreement says partners are eligible to get interest on capital at 10%. Income Statement of a Partnership firm shows the net profit of OMR 200,000. How much profit X and Y will receive from the partnership?
A partnership agreement states that following: the partners shall participate in profits: partner 1 - 70%, partner 2 - 25% and partner 3 - 5%. if the partnership had net income for the year of $135,000, what would be partner's 2 share of the income? a. $33,750. b. $94,500. c. $100,000. d. $6,750.
A written Partnership Agreement states: Partner A is to contribute capital of $20,000 and devotes full time work to the partnership. Partner B is to contribute capital of $30,000 and devotes half time work to the partnership. Therefore, in what ratio is net income to be divided? Group of answer choices a) 1:2 b) 3:5 c) 2:3 d) 1:1
Requirement: Compute for the respective shares of the partners in 3. The partnership agreement of A and B stipulates the following: Annual salaries of P100,000 for A and P60,000 for B. 20% bonus to A, based on profit after salaries and bonus. Balance is shared equally. The partnership earned profit of P520,000 before salaries and bonus. Requirement: Compute for the respective shares of the partners in the profit. 4. A and B's partnership agreement provides for an annual salary allowance of P100,000 for A and 10% interest on the weighted average capital balance of B. The remainder is shared equally. During the period, the partnership earned profit of P200,000. B’s capital account had a beginning balance of P120,000. B made additional investments of P60,000 on March 1, P40,000 on Sept. 30, and made drawings of P30,000 on Aug. 1 and P9,000 on Nov. 1. Requirement: Compute for the respective shares of the partners the profit.
The ABC Partnership agreement provides for guaranteed payments for services rendered of $70,000, $64,000, and $60,000 for Adam, Brian, and Cynthia, respectively. After the guaranteed payments are deducted, the partnership agreement calls for sharing of profits and losses as follows: Adam – 40%, Brian – 35%; Cynthia – 25%. Each partner is a general partner. If net profits before the guaranteed payments are $176,000, what amount of income from the partnership should each partner report on his or her individual income tax return (what amount for each partner is subject to self-employment tax)?
The following are the partnership agreement between partners Baby Love & Honey Sweet for their partnership’s profit distribution:A. Each partners shall be entitled for an annual salary of P50,000 each.B. 15% Bonus of partnership profits after salaries to Honey Sweet being a managing partner.C. 20% interest is given to both partners based on average capital ratio.D. Residual profit and loss shall be distributed on the ratio 2:2The ledgers of their capital balances are shown below: Baby Love Debit: July 1. P20,000 Credit: Jan 1. P80,000 Oct 1. P40,000 Honey Sweet Debit: Oct 1. P10,000 Credit: Jan 1. P120,000 May 1. 30,000 The partnership profit for the year is P150,000 before distribution to partners Required: 1. Prepare a Schedule for Profit Distribution.2. Journal entry to record the distribution of profit to partners.
A partnership begins its first year with the following capital balances: Alexander, Capital Bertrand, Capital Coloma, Capital The articles of partnership stipulate that profits and losses be assigned in the following manner: • Each partner is allocated interest equal to 6 percent of the beginning capital balance. • Bertrand is allocated compensation of $18,000 per year. • Any remaining profits and losses are allocated on a 3:3:4 basis, respectively. • Each partner is allowed to withdraw up to $3,000 cash per year. $ 62,000 72,000 82,000 Assuming that the net income is $72,000 and that each partner withdraws the maximum amount allowed, what is the balance in Coloma's capital account at the end of the year? Multiple Choice $103,336 $86,920 $100,336
16. A person may become a partner in a partnership by all of the following methods except A. Investing in the partnership with a bonus to the new partners B. Making a loan to the partnership C. Investing in the partnership with a bonus to the old partnes D. Purchasing a partner's interest 17. B. Andy's interest in the partnership is 110,000. M. Joy buys Andy's interest for 120,000. How much is the capital balance of Joy after the purchase? А. 120,000 В. 110,000 С. 130,000 D. 140,000 18. L. Garcia, A. Harina, and E. Isla are partners with capital of P90,000,P50,000, and P60,000, respectively. M. Joson is admitted into the partnership with 4 interest upon payment of 80,000. If the old partners share profits and losses in the ratio of 2/5, 2/5, and 1/5, then the capital account of Isla after the admission of Joson will show a balance of А. 50,000 В. 52,500 С. 62,000 D. 70,000
The FF and II partnership agreement provides for FF to receive a 20% bonus on profits before thebonus. Remaining profits and losses are divided between FF and II in the ratio of 2:3 respectively.Which partner has a greater advantage when the partnership has a profit? When it has a loss? a. FF; IIb. FF; FFc. II; FFd. II; II
The partnership agreement of Angela and Dawn has the following provisions: The partners are to earn 10 percent on the average capital. Angela and Dawn are to earn salaries of $26,000 and $18,000, respectively. Any remaining income or loss is to be divided between Angela and Dawn using a 70:30 ratio. Angela’s average capital is $66,000 and Dawn’s is $52,000. Required: Prepare an income distribution schedule assuming the income of the partnership is (a) $90,000 and (b) $33,000. If no partnership agreement exists, what does the UPA 1997 prescribe as the profit or loss distribution percentages? Note: Amounts that are to be deducted from an individual partner's capital balance should be entered with a minus sign.
The partnership agreement of Angela and Dawn has the following provisions: The partners are to earn 10 percent on the average capital.Angela and Dawn are to earn salaries of $31,000 and $15,000, respectively.Any remaining income or loss is to be divided between Angela and Dawn using a 70:30 ratio. Angela’s average capital is $63,000 and Dawn’s is $44,000.Required:Prepare an income distribution schedule assuming the income of the partnership is (a) $91,000 and (b) $22,000. If no partnership agreement exists, what does the UPA 1997 prescribe as the profit or loss distribution percentages? (Amounts that are to be deducted from an individual partner's capital balance should be entered with a minus sign.)
Question-based on partnership I have tried it but incorrect, the first 2 answers are wrong. Thanks for the help.

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