Maxwell is trying to decide whether to accept a salary of ₱40,000 or a salary of ₱25,000 plus a bonus of 10% of profit after salaries and bonus, as a means of allocating profit among partners. Salaries traceable to the other partners are estimated to be ₱100,000. What amount of profit would be necessary so that Maxwell would consider the choices to be equal?

Maxwell is trying to decide whether to accept a salary of ₱40,000 or a salary of ₱25,000 plus a bonus of 10% of profit after salaries and bonus, as a means of allocating profit among partners. Salaries traceable to the other partners are estimated to be ₱100,000. What amount of profit would be necessary so that Maxwell would consider the choices to be equal?

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter15: Partnership Accounting

Section: Chapter Questions

Problem 2PA: Arun and Margot want to admit Tammy as a third partner for their partnership. Their capital balances...

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Maxwell is trying to decide whether to accept a salary of P40,000 or salary of P25,000 plus a bonus of 10% of net income after salaries and bonus as a means of allocating profit among partners. Salaries traceable to the other partners are estimated to be P100,000. What amount of income would be necessary so that Maxwell would consider choices to be equal?
Romeo is trying to decide whether to accept a salary of P40,000 or a salary of P25,000 plus a bonus of 10% of net income after salary and bonus as a means of allocating profit among the partners. Salaries traceable to the other partners are estimated to be P100,000. What amount of income would be necessary so that Romeo would consider the choices equal: A. 165,000 B. 290,000 C. 265,000 D. 305,000
Tyrone is trying to decide whether to accept a salary ofP40,000 or a salary or P25,000 plus a bonus of 10% of net income after salaries and bonus as a way of dividing profits among the partners. Salaries traceable to the other partners is P100,000. What is the amount of income would make the choices equal?
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Kali and Jane are contemplating on the profit-sharing strategy of the partnership. However, the selected modes of profit distribution vary according to their level of income. Jane was offered a salary of P50,000 or a salary of P20,000 plus a bonus of 15% of net income after salary and bonus. Per estimate, other partners were to receive also a salary amounting to P150,000. What income level would result to indifference on Jane?
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