ABC, DEF and GHI formed a partnership on April 1, 2022 and contributed P300,000, P200,000 and P500,000 respectively. The partners agreed that income will be disturbed as follows: > Annual Salary: ABC for P24,000, DEF for P18,000 and GHI for P12,000 ➤ Interest of 12% on the average capital during 2022 of the three partners ➤ The remainder in the ratio of 40%, 40% and 20% for ABC, DEF and GHI respectively. The operating income for the year ending December 31, 2022 amounted to P176,000. ABC contributed additional capital of P60,000 on July 1, 2022 and made a withdrawal of P20,000 on October 1. DEF contributed additional capital of P40,000 on August 1 and made a withdrawal of P5,000 on October 1. GHI made a withdrawal of P30,000 on November 1. Compute
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.
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