Accounting EZ-Tax is a tax accounting practice with partners and staff members. Each billable hour of partner time has a $520 budgeted price and $230 budgeted variable cost. Each billable hour of staff time has a budgeted price of $140 and a budgeted variable cost of $80. For the most recent year, the partnership budget called for 8,200 billable partner-hours and 36,650 staff-hours. Actual results were as follows. Partner revenue $ 3,884,000 7,700 hours Staff revenue $ 5,065,000 36,000 hours Required: a. Compute the sales price variance. b. Compute the total sales activity variance. c. Compute the total sales mix variance. d. Compute the total sales quantity variance. (For all requirements, do not round intermediate calculations. Indicate the effect of each variance by selecting "F" for favorable, or "U" for unfavorable. If there is no effect, do not select either option. Enter your answers rounded to the nearest whole dollar) a. Partner Staff b. Sales activity variance C. Sales mix variance d. Sales quantity variance

Accounting EZ-Tax is a tax accounting practice with partners and staff members. Each billable hour of partner time has a $520 budgeted price and $230 budgeted variable cost. Each billable hour of staff time has a budgeted price of $140 and a budgeted variable cost of $80. For the most recent year, the partnership budget called for 8,200 billable partner-hours and 36,650 staff-hours. Actual results were as follows. Partner revenue $ 3,884,000 7,700 hours Staff revenue $ 5,065,000 36,000 hours Required: a. Compute the sales price variance. b. Compute the total sales activity variance. c. Compute the total sales mix variance. d. Compute the total sales quantity variance. (For all requirements, do not round intermediate calculations. Indicate the effect of each variance by selecting "F" for favorable, or "U" for unfavorable. If there is no effect, do not select either option. Enter your answers rounded to the nearest whole dollar) a. Partner Staff b. Sales activity variance C. Sales mix variance d. Sales quantity variance

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Description: AccountingEZ-Tax is a tax accounting practice with partners and staff members. Eachbillable hour of partner time has a $520 budgeted price and $230 budgetedvariable cost. Each billable hour of staff time has a budgeted price of $140 anda budgeted va

SWFT Corp Partner Estates Trusts

42nd Edition

ISBN:9780357161548

Author:Raabe

Publisher:Raabe

Chapter10: Partnerships: Formation, Operation, And Basis

Section: Chapter Questions

Problem 41P

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EZ-Tax is a tax accounting practice with partners and staff members. Each billable hour of partner time has a $550 budgeted price and $270 budgeted variable cost. Each billable hour of staff time has a budgeted price of $130 and a budgeted variable cost of $60. For the most recent year, the partnership budget called for 7,900 billable partner-hours and 35,700 staff-hours. Actual results were as follows. Partner revenue $ 4,025,000 7,500 hours Staff revenue $ 4,580,000 35,000 hours Required: a. Compute the sales price variance. b. Compute the total sales activity variance. c. Compute the total sales mix variance.
During the current year, ARC Partnership reported the following items of receipts and expenditures: $500,000 sales, $50,000 utilities, $90,000 rent, $200,000 salaries to employees, $50,000 guaranteed payment to partner Mitchell, investment interest income of $4,000, a charitable contribution of $10,000, and a distribution of $40,000 to partner Rowan. Also, Ava received a $30,000 distribution. Ava is a 50% partner. What items will be reflected on Ava’s Schedule K-1? Assuming Ava’s outside basis at the beginning of the year is $100,000. What will be her ending outside basis at the end of this fiscal year? Is her distribution taxable? If so will it be taxable at her tax rate or at the partnerships?
Salem and Durham entered into a partnership to provide supply chain management and logistic services in the Silicon Valley region of California. In their agreed Articles of Partnership, the partners acknowledged the following: Sharing of profits and losses: Compensate each partner $125 per hour for their billable hourly consulting work performed. Salem receives an additional $3,000 monthly as the partnership’s Chief Operating Officer (COO); Durham receives an additional $2,500 monthly as the partnership’s Chief Technology Officer (CTO), Any remaining profits or losses are divided equally between the partners. Each partner is permitted but not required to withdraw no more than $800 per month from the partnership and such withdrawals will be accounted for as direct reductions of the withdrawing partner’s capital balance. They will begin their partnership with equal beginning capital balances. On January 1, 20x1, when they formed the partnership, each partners’…
Salem and Durham entered into a partnership to provide supply chain management and logistic services in the Silicon Valley region of California. In their agreed Articles of Partnership, the partners acknowledged the following: Sharing of profits and losses: Compensate each partner $125 per hour for their billable hourly consulting work performed. Salem receives an additional $3,000 monthly as the partnership’s Chief Operating Officer (COO); Durham receives an additional $2,500 monthly as the partnership’s Chief Technology Officer (CTO), Any remaining profits or losses are divided equally between the partners. Each partner is permitted but not required to withdraw no more than $800 per month from the partnership and such withdrawals will be accounted for as direct reductions of the withdrawing partner’s capital balance. They will begin their partnership with equal beginning capital balances. On January 1, 20x1, when they formed the partnership, each partners’…
Salem and Durham entered into a partnership to provide supply chain management and logistic services in the Silicon Valley region of California. In their agreed Articles of Partnership, the partners acknowledged the following: Sharing of profits and losses: Compensate each partner $125 per hour for their billable hourly consulting work performed. Salem receives an additional $3,000 monthly as the partnership’s Chief Operating Officer (COO); Durham receives an additional $2,500 monthly as the partnership’s Chief Technology Officer (CTO), Any remaining profits or losses are divided equally between the partners. Each partner is permitted but not required to withdraw no more than $800 per month from the partnership and such withdrawals will be accounted for as direct reductions of the withdrawing partner’s capital balance. They will begin their partnership with equal beginning capital balances. On January 1, 20x1, when they formed the partnership, each partners’…
lemon and salt entered into a partnership to provide supply chain management and logistic services in the san francisco region of California. In their agreed Articles of Partnership, the partners acknowledged the following: Sharing of profits and losses: Compensate each partner $125 per hour for their billable hourly consulting work performed. lemon receives an additional $3,000 monthly as the partnership’s Chief Operating Officer (COO); salt receives an additional $2,500 monthly as the partnership’s Chief Technology Officer (CTO), Any remaining profits or losses are divided equally between the partners. Each partner is permitted but not required to withdraw no more than $800 per month from the partnership and such withdrawals will be accounted for as direct reductions of the withdrawing partner’s capital balance They will begin their partnership with equal beginning capital balances. On January 1, 20x1, when they formed the partnership, each partners’ contributions were as…
lemon and salt entered into a partnership to provide supply chain management and logistic services in the san francisco region of California. In their agreed Articles of Partnership, the partners acknowledged the following: Sharing of profits and losses: Compensate each partner $125 per hour for their billable hourly consulting work performed. lemon receives an additional $3,000 monthly as the partnership’s Chief Operating Officer (COO); salt receives an additional $2,500 monthly as the partnership’s Chief Technology Officer (CTO), Any remaining profits or losses are divided equally between the partners. Each partner is permitted but not required to withdraw no more than $800 per month from the partnership and such withdrawals will be accounted for as direct reductions of the withdrawing partner’s capital balance They will begin their partnership with equal beginning capital balances. On January 1, 20x1, when they formed the partnership, each partners’ contributions were as…
Your client is a partnership, ARP Associates, which is an engineering consulting firm. Generally, ARP bills clients for services at the end of each month. Client billings are about 50,000 each month. On average, it takes 45 days to collect the receivables. ARPs expenses are primarily for salary and rent. Salaries are paid on the last day of each month, and rent is paid on the first day of each month. The partnership has a line of credit with a bank, which requires monthly financial statements. These must be prepared using the accrual method. ARPs managing partner, Amanda Sims, has suggested that the firm also use the accrual method for tax purposes and thus reduce accounting fees by 600. Assume that the partners are in the 35% (combined Federal and state) marginal tax bracket. Write a letter to your client explaining why you believe it would be worthwhile for ARP to file its tax return on the cash basis even though its financial statements are prepared on the accrual basis. ARPs address is 100 James Tower, Denver, CO 80208.
Find Bonus, Interest, and Reminder to allocate for each The partnership agreement of Jones, King, and Lane provides for the annual allocation of the business's profit or loss in the following sequence: Jones, the managing partner, receives a bonus equal to 10 percent of the business’s profit. Each partner receives 10 percent interest on average capital investment. Any residual profit or loss is divided equally. The average capital investments for 2021 were as follows: Jones $ 80,000 King 160,000 Lane 240,000 The partnership earned $40,000 net income for 2021. Prepare a schedule showing how the 2021 net income should be allocated to the partners
Terry Willard and Jasmine Hill decide to form a partnership. Willard will contribute $300,000 to the partnership, while hill will contribute only $30,000. However, Hill will be responsible for running the day-to-day operations of the partnership, which are anticipated to require about 45 hours per week. In contrast, Willard will only work five hours per week for partnership. The two partners are attempting to determine a formula for dividing partnership net income. Willard believes the partners should divide income in the ratio of 7:3, favoring Willard, since Willard provides the majority of the capital. Hill believes the income should divided 7:3, favoring Hill, since Hill provides the majority of effort in running the partnership business. How would you advise the partners in developing a method for diving income?
PFW Co. reports net income of €45,000. Partner salary allowances are Pitts €15,000, Filbert €5,000, and Witten €5,000. Indicate the division of net income to each partner, assuming the income ratio is 50:30:20, respectively.
Carla Vista Co. reports net income of $67,000. Partner salary allowances are Pitts $12,000, Filbert $8,000, and Witten $4,000. Indicate the remaining income and division of net income to each partner, assuming the income ratio is 56 : 20 : 24, respectively.