Pdfcoffee - t uoppppppp PDF

Preview

Summary

PARTNERSHIP OPERATIONSDivision of profits and losses A, B, and C's partnership agreement stipulate the following: Case #1: Sufficient profit a. Annual salaries of P12,000 to A and P8,000 to C The partnership earns profi b. 10% bonus to A, based on profit after salaries but before partners' respectiv...

Description

PARTNERSHIP OPERATIONS Division of profits and losses A, B, and C's partnership agreement stipulate the following: a. Annual salaries of P12,000 to A and P8,000 to C b. 10% bonus to A, based on profit after salaries but before before deducting the bonus c. 10% interest on the following capital contributions A - P100,000 B - P60,000 C - P120,000 d. P/L ration of 40:30:30 Case #1: Sufficient profit The partnership earns profit of P100,000. Compute for the partners' respective shares Case #2 The partnership earns profit of P10,000. Compute for the partner's respective shares Case #3 The partnership incurs loss of P20,000. Compute for the partner's respective shares

Case #1: Sufficient profit The partnership earns prof partners' respective shares

Amount being allocated Allocation: a. Salaries b. Bonus (100K - 20K) x 10% c. Interest A - (100K x 10%) B - (60K x 10%) C - (120K x 10%) d. Remainder 44,000

Case #2 The partnership earns prof respective shares

Amount being allocated Allocation: a. Salaries b. Bonus N/A c. Interest A - (100K x 10%) B - (60K x 10%) C - (120K x 10%) d. Remainder -38,000

Case #3 The partnership incurs loss respective shares

Amount being allocated Allocation:

a. Salaries b. Bonus N/A c. Interest A - (100K x 10%) B - (60K x 10%) C - (120K x 10%) d. Remainder -₱68,000

fit of P100,000. Compute for the s A

B

12,000 8,000

C

8,000

10,000

13,200 19,200

20,000 8,000

12,000

10,000 6,000 12,000

13,200 33,200

44,000 100,000

6,000

17,600 47,600

Total 100,000

fit of P10,000. Compute for the partner's

A

B

12,000

C

8,000

10,000

15,200 6,800

11,400 -5,400

20,000 0

12,000

10,000 6,000 12,000

11,400 8,600

-38,000 10,000

6,000

-

Total 10,000

s of P20,000. Compute for the partner's

A

B

C

Total -20,000

Interest on weighted average capital A and B's partnership agreement stipulates the a. Monthly salary of 4,000 to A b. 20% bonus to A, based on profit after de but before deduction for interest c. 12% interest on B's weighted average cap B initially contributed P30,000. During th P10,000 on July 1 and P6,000 on Novem d. Balance is shared equally

12,000

8,000

10,000 12,000

10,000 6,000 12,000

-₱20,400 -₱400

-₱68,000 -₱20,000

6,000

-₱27,200 -₱5,200

-₱20,400 -₱14,400

20,000 0

e following: eductions for salary and bonus, pital balance. he period, B contributed additional ber 30, and withdrew P4,000 on Oct 1

Case #1: Full year The partnership earned profit of P90,000, before salaries, bo for the year ended Dec 31, 2020 Requirement: Provide the journal entry to close the income summary acco respective capital accounts A Amount being allocated Allocation: a. Salaries (4,000 x 12mos) b. Bonus c. Interest on weighted ave. capital d. Remainder 30,860

B

48,000 7,000 4,140 15,430 70,430

15,430 19,570

= 20% (90,000 - 48,000 - Bonus) = 20% (42,000 - Bonus) = 8,400 - (20%Bonus) 120% Bonus = 8,400 Bonus = 7,000 Bonus

Beg. Balance Jul-01 Oct-01 Nov-30

Balances 30,000 10,000 -4,000 6,000

Income summary A, capital B, capital

30,000 5,000 -1,000 500 34,500 12% 4,140

90,000 70,430 19,570

onus and interest on capital

unt to the partners'

Case #2: Partial year The partnership earned profit of P90,000, before salarie for the eight months ended Dec 31, 2020 Requirement: Provide the journal entry to close the income summary a respective capital accounts A

Total 90,000 48,000 7,000 4,140 30,860 90,000

Amount being allocated Allocation: a. Salaries (4,000 x 8mos) 32,000 b. Bonus 9,667 c. Interest on weighted ave. capital d. Remainder 45,393 22,697 64,363

Bonus

120% Bonus Bonus

Beg. Balance Jul-01 Oct-01 Nov-30

B

2,940 22,697 25,637

= 20% (90,000 - 32,000 - Bonus) = 20% (58,000 - Bonus) = 11,600 - (20%Bonus) = 11,600 = 9,667

Balances 30,000 10,000 -4,000 6,000

Income summary A, capital B, capital

20,000 5,000 -1,000 500 24,500 12% 2,940

90,000 64,363 25,637

s, bonus and interest on capital

account to the partners'

Total 90,000 32,000 9,667 2,940 45,393 90,000...