Nancy and Betty enter into a partnership agreement whereby they undertake to share profits according to the following rules (a) Nancy and Betty will receive salaries of $14,500 and s22,500 respectively as the first allocation. (b) The next allocation is based on 20% of each partner's capital balances. (C) Any remaining profit or loss is to be allocated completely to Betty. The partnership's net loss for the first year is $50,000. Nancys capital balance is $98,000 and Betty's capital balance is $9000 at the end of the year. Calculate the share of profit (loss) to be allocated to Nancy A) $34,100 B) $(19,600) ) $14,500 D) $(84,100)
Nancy and Betty enter into a partnership agreement whereby they undertake to share profits according to the following rules (a) Nancy and Betty will receive salaries of $14,500 and s22,500 respectively as the first allocation. (b) The next allocation is based on 20% of each partner's capital balances. (C) Any remaining profit or loss is to be allocated completely to Betty. The partnership's net loss for the first year is $50,000. Nancys capital balance is $98,000 and Betty's capital balance is $9000 at the end of the year. Calculate the share of profit (loss) to be allocated to Nancy A) $34,100 B) $(19,600) ) $14,500 D) $(84,100)
Chapter15: Partnership Accounting
Section: Chapter Questions
Problem 1PB: The partnership of Magda and Sue shares profits and losses in a 50:50 ratio after Mary receives a...
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Transcribed Image Text:C. D
D. B
Nancy and Betty enter into a partnership agreement whereby they undertake to share profits
according to the following rules
(a) Nancy and Betty will receive salaries of $14,500 and s22,500 respectively as the first allocation.
(b) The next allocation is based on 20% of each partner's capital balances.
(C) Any remaining profit or loss is to be allocated completely to Betty.
The partnership's net loss for the first year is $50,000, Nancy's capital balance is $98,000 and Betty's
capital balance is $9000 at the end of the year. Calculate the share of profit (loss) to be allocated to
Nancy
A) $34,100
B) $(19,600)
C) $14,500
D) $(84,100)
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