Distribution of Profits and Losses: 2. Rene, Michael and Kevin are partners in an accounting firm. Their capital account balance at year-end were Rene, P90,000; Michael, P120,000; and Kevin, P160,000. They share profit and losses on a 4:4:2 ratio after considering the following terms: a. Kevin is to receive a bonus of 10% of net income. b. Interest of 5% shall be paid on partner's capital. c. Salaries of P8,000 and P10,000 shall be paid to partners Rene and Kevin respectively. Assuming a net income of P84,000 for the year. REQUIRED: Prepare the following: A. Profit or Loss Distribution Table B. Corresponding JOURNAL ENTRY to distribute profit or loss

Distribution of Profits and Losses: 2. Rene, Michael and Kevin are partners in an accounting firm. Their capital account balance at year-end were Rene, P90,000; Michael, P120,000; and Kevin, P160,000. They share profit and losses on a 4:4:2 ratio after considering the following terms: a. Kevin is to receive a bonus of 10% of net income. b. Interest of 5% shall be paid on partner's capital. c. Salaries of P8,000 and P10,000 shall be paid to partners Rene and Kevin respectively. Assuming a net income of P84,000 for the year. REQUIRED: Prepare the following: A. Profit or Loss Distribution Table B. Corresponding JOURNAL ENTRY to distribute profit or loss

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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