Net income at the end of the year is P100,000. Partners, A, B, C and D, share profits and losses in the ratio of average capital. Interest will be allowed at 5% of average capital for the year which is P10,000, P20,000, P30,000, P40,000, respectively. Salary of P3,000 per month will be allowed for A, the managing partner. Bonus shall be provided at 25% of net income but shall not exceed P20,000 and will be divided based on the ratio of 10%, 20%, 25%, 45%. 1. The net loss for the year is P8,000. Partners, A and Z, share profits and losses in the ratio of 60%, 40%. Annual salary will be given to Z for P14,000 and partners are provided 20% bonus on net income to be divided equally. Income for the year is P12,000. The division of income/loss is based on the ratio of 3:2:1. Bonus will be given to partners for P3,000 each. The partners are X, Y and Z. 3. 2.

Net income at the end of the year is P100,000. Partners, A, B, C and D, share profits and losses in the ratio of average capital. Interest will be allowed at 5% of average capital for the year which is P10,000, P20,000, P30,000, P40,000, respectively. Salary of P3,000 per month will be allowed for A, the managing partner. Bonus shall be provided at 25% of net income but shall not exceed P20,000 and will be divided based on the ratio of 10%, 20%, 25%, 45%. 1. The net loss for the year is P8,000. Partners, A and Z, share profits and losses in the ratio of 60%, 40%. Annual salary will be given to Z for P14,000 and partners are provided 20% bonus on net income to be divided equally. Income for the year is P12,000. The division of income/loss is based on the ratio of 3:2:1. Bonus will be given to partners for P3,000 each. The partners are X, Y and Z. 3. 2.

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter16: Financial Statement Analysis

Section: Chapter Questions

Problem 20E

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