Edmund, Harry and Vincent formed a partnership on January 1, 2018. Each contributed P120,000. Salaries were to be allocated as follows:Edmund- P30,000Harry- P30,000Vincent- P45,000Drawings were equal to salaries and be taken out evenly throughout the year. With sufficient partnership net income, Edmund and Harry could split a bonus equal to 25% of partnership net income after salaries and bonus (in no event could the bonus go below zero). Remaining profits were to be divided as follows: 30% for Edmund; 30% for Harry, and 40% for Vincent. For the year, partnership net income was P120,000.Compute the ending capital for each partner: Do I need to distribute the net income in getting the ending?
Edmund, Harry and Vincent formed a partnership on January 1, 2018. Each contributed P120,000. Salaries were to be allocated as follows:Edmund- P30,000Harry- P30,000Vincent- P45,000Drawings were equal to salaries and be taken out evenly throughout the year. With sufficient partnership net income, Edmund and Harry could split a bonus equal to 25% of partnership net income after salaries and bonus (in no event could the bonus go below zero). Remaining profits were to be divided as follows: 30% for Edmund; 30% for Harry, and 40% for Vincent. For the year, partnership net income was P120,000.Compute the ending capital for each partner: Do I need to distribute the net income in getting the ending?
Chapter14: Choice Of Business Entity—operations And Distributions
Section: Chapter Questions
Problem 47P
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Edmund, Harry and Vincent formed a partnership on January 1, 2018. Each contributed P120,000. Salaries were to be allocated as follows:Edmund- P30,000Harry- P30,000Vincent- P45,000Drawings were equal to salaries and be taken out evenly throughout the year. With sufficient partnership net income, Edmund and Harry could split a bonus equal to 25% of partnership net income after salaries and bonus (in no event could the bonus go below zero). Remaining profits were to be divided as follows: 30% for Edmund; 30% for Harry, and 40% for Vincent. For the year, partnership net income was P120,000.Compute the ending capital for each partner: Do I need to distribute the net income in getting the ending?
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