AB Partnership’s operation for the year 2022 resulted in a profit of P180,000. Their profit sharing agreement provided the following: a. Salaries of P15,000 and P25,000 is to be given to A and B respectively; b. 15% of profit after salaries but before bonus is to be given to Partner B; c. The balance is to be divided using the 3:2 ratio, respectively. How much profit is to be allocated to B?
Partnership Accounting
A partnership is a kind of arrangement between two or more people whereby they agree to manage the business operations and share its profits and losses in an agreed ratio between them. The agreement that is drafted and signed by the partners of the firm is termed as partnership deed and contains various important clauses agreed between the partners such as profit/loss sharing, interest on capital, remuneration allocation of each partner, drawings, admission of a new partner, etc.
Partner Admission and Withdrawal
A partnership is a kind of arrangement between two or more people whereby they agree to manage the business operations and share its profits and losses in an agreed ratio between them. The agreement that is drafted and signed by the partners of the firm is termed as a partnership deed and contains various important clauses agreed between the partners such as profit/loss sharing, interest on capital, remuneration allocation of each partner, drawings of a partner, etc.
AB
a. Salaries of P15,000 and P25,000 is to be given to A and B respectively;
b. 15% of profit after salaries but before bonus is to be given to Partner B;
c. The balance is to be divided using the 3:2 ratio, respectively.
How much profit is to be allocated to B?
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