Exercise 3: Use the following information for the next two cases: A&B Partnership earns profit of $240,000 in 20x1. The movements in the capital accounts of the partners are shown below: Jan. 1 May 1 July 1 Aug. 1 Oct. 1 DT. 20,000 10,000 A, capital Cr. 120,000 10,000 Dr. B, capital 10,000 5,000 CT. 80,000 20,000 Case #1: Compute for the partners' respective shares if profits are to be divided based on average capital. Case #2: Compute for the partners' respective shares if the partners are entitled to 20% interest on the ending balances of their capital accounts and any remainder is shared equally.

Exercise 3: Use the following information for the next two cases: A&B Partnership earns profit of $240,000 in 20x1. The movements in the capital accounts of the partners are shown below: Jan. 1 May 1 July 1 Aug. 1 Oct. 1 DT. 20,000 10,000 A, capital Cr. 120,000 10,000 Dr. B, capital 10,000 5,000 CT. 80,000 20,000 Case #1: Compute for the partners' respective shares if profits are to be divided based on average capital. Case #2: Compute for the partners' respective shares if the partners are entitled to 20% interest on the ending balances of their capital accounts and any remainder is shared equally.

SWFT Comprehensive Volume 2019

42nd Edition

ISBN:9780357233306

Author:Maloney

Publisher:Maloney

Chapter21: Partnerships

Section: Chapter Questions

Problem 57P

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Similar questions

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