JJ and KK are partners who share profits and losses in the ratio of 60%:40% respectively. JJ’s salary is 60,000and 30,000 to KK. The partners are also paid interest on their average capital balances. In 2021, JJ received 30,000 of interest and KK 12,000. The profit and loss allocation is determined after deductions for salary and interest payments. If KK’s share in the residual income (income after salaries and interest) was 60,000, what was the total partnership income
JJ and KK are partners who share profits and losses in the ratio of 60%:40% respectively. JJ’s salary is 60,000and 30,000 to KK. The partners are also paid interest on their average capital balances. In 2021, JJ received 30,000 of interest and KK 12,000. The profit and loss allocation is determined after deductions for salary and interest payments. If KK’s share in the residual income (income after salaries and interest) was 60,000, what was the total partnership income
Chapter15: Partnership Accounting
Section: Chapter Questions
Problem 1PA: The partnership of Tatum and Brook shares profits and losses in a 60:40 ratio respectively after...
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JJ and KK are partners who share profits and losses in the ratio of 60%:40% respectively. JJ’s
salary is 60,000and 30,000 to KK. The partners are also paid interest on their average capital
balances. In 2021, JJ received 30,000 of interest and KK 12,000. The
determined after deductions for salary and interest payments. If KK’s share in the residual income
(income after salaries and interest) was 60,000, what was the total
a. 192,000
b. 345,000
c. 282,000
d. 387,000
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