X and Y formed a partnership on January 1, 2020. X contributed net assets of P500,000 and Y no capital contribution because she will manage the firm on a full time basis. Their partnership agreement to distribute profit were as follows: a) Interest at 5% shall be allowed on the beginning capital. b) Y is to be paid salaries of P10,000 per month. c) Y is to received a bonus of 30% of profit before deducting interest and salaries. d) Profits are to be divided between X and Y in the ratio of 6:4 There are no withdrawals by either partner during the year. The partnership statement of income contains the following information. Revenues P1,520,000 Expenses (including salary and interest) 820.000 Profit P 700,000 How much is the equity of X at year-end?
X and Y formed a partnership on January 1, 2020. X contributed net assets of P500,000 and Y no capital contribution because she will manage the firm on a full time basis. Their partnership agreement to distribute profit were as follows: a) Interest at 5% shall be allowed on the beginning capital. b) Y is to be paid salaries of P10,000 per month. c) Y is to received a bonus of 30% of profit before deducting interest and salaries. d) Profits are to be divided between X and Y in the ratio of 6:4 There are no withdrawals by either partner during the year. The partnership statement of income contains the following information. Revenues P1,520,000 Expenses (including salary and interest) 820.000 Profit P 700,000 How much is the equity of X at year-end?
Chapter21: Partnerships
Section: Chapter Questions
Problem 38P
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Transcribed Image Text:X and Y formed a partnership on January 1, 2020. X contributed net assets of P500,000 and Y no
capital contribution because she will manage the firm on a full time basis. Their partnership
agreement to distribute profit were as follows:
a) Interest at 5% shall be allowed on the beginning capital.
b) Y is to be paid salaries of P10,000 per month.
C) Y is to received a bonus of 30% of profit before deducting interest and salaries.
d) Profits are to be divided between X and Y in the ratio of 64
There are no withdrawals by either partner during the year. The partnership statement of income
contains the following information.
Revenues P1,520,000
Expenses (including salary and interest) 820000
Profit P 700,000
How much is the equity of X at year-end? (
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