Financial Accounting
Financial Accounting
14th Edition
ISBN: 9781305088436
Author: Carl Warren, Jim Reeve, Jonathan Duchac
Publisher: Cengage Learning
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Question
Chapter 12, Problem 9E

a.

To determine

Prepare the journal entry to record monthly partner drawing in the month of January.

b.

To determine

Prepare the journal entry to record closing entry of income summary account at the end of the year.

c.

To determine

Prepare the journal entry to record closing entry of drawing account at the end of the year.

d.

To determine

Explain why partner drawings would be considered “reclaimable” until profits have been allocated.

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The partnership agreement of X, Y, and Z stipulates the following:   Partners Y and Z shall receive annual salaries of P23,000 and P12,000, A bonus of 15% of profit after salaries but before deduction of bonus shall be given to Partner X, the managing Each partner shall receive 11% interest on average capital Any remaining profit or loss shall be shared as follows: 30% to X, and 35% each to Y and   The average capital investments of the partners during the year are as follows: X – P125,000; Y – P78,000; and Z – P101,000. Case # 3: The partnership incurs a loss of P19,000. 1. How much is X's share in the profit/loss?     a. (P 12,482) c. (P7,494) b. P 976 d. (P 19,000) 2. How much is Y's share in the profit/loss?     a. (P 12,482) b. P 976 c. (P7,494) (P 19,000) 3. How much is Z's share in the profit/loss?     a. (P 12,482) c. (P7,494) b. P 976 d. (P 19,000)
After the tangible assets have been adjusted to current market prices, the capital accounts of Grayson Jackson and Harry Barge have balances of $42,590 and $59,110, respectively. Lewan Gorman is to be admitted to the partnership, contributing $30,890 cash to the partnership, for which he is to receive an ownership equity of $36,030. All partners share equally in income. a. On December 31, journalize the entry to record the admission of Gorman, who is to receive a bonus of $5,140. Refer to the chart of accounts for the exact wording of the account titles. CNOW journals do not use lines for journal explanations. Every line on a journal page is used for debit or credit entries. CNOW journals will automatically indent a credit entry when a credit amount is entered.     JOURNAL     DATE DESCRIPTION POST. REF. DEBIT CREDIT       1                 2                 3                 4…
KC and Jojo are considering formed a partnership whereby profits will be allocated through the use of salaries, interest and bonuses. The following are their capital balances for the current year, 2019:   KC, Capital Jojo, Capital 1-Jan -35,000 -25,000 1-Mar   -10,000 1-Jun -10,000   1-Sep   10,000 1-Oct -5,000   1-Nov   5,000 1-Dec   -8,000   It was agreed that a bonus of 10% of partnership profits after bonus is credited to KC. Further a salary of P35,000 and P20,000 is allocated to Jojo and KC, respectively; a 10% interest on weighted capital is allocated; and remainder is equally divided. The profit for the year amounted to P65,191. How much is the profit distribution to KC and Jojo, respectively? (Round off to nearest peso) P29,671 / P36,520 P29,967 / P36,224 P29,159/ P32,032 P29,455 / P35,736

Chapter 12 Solutions

Financial Accounting

Ch. 12 - Prob. 1PEACh. 12 - Prob. 1PEBCh. 12 - Prob. 2PEACh. 12 - Prob. 2PEBCh. 12 - Prob. 3PEACh. 12 - Prob. 3PEBCh. 12 - Prob. 4PEACh. 12 - Prob. 4PEBCh. 12 - Prior to liquidating their partnership, Parker and...Ch. 12 - Liquidating partnerships Prior to liquidating...Ch. 12 - Prob. 6PEACh. 12 - Prob. 6PEBCh. 12 - Prob. 7PEACh. 12 - Eclipse Architects earned 1,800,000 during 2016...Ch. 12 - Prob. 1ECh. 12 - Prob. 2ECh. 12 - Prob. 3ECh. 12 - Prob. 4ECh. 12 - Prob. 5ECh. 12 - Prob. 6ECh. 12 - Prob. 7ECh. 12 - Marvel Media, LLC, has three members: WLKT...Ch. 12 - Prob. 9ECh. 12 - Prob. 10ECh. 12 - Prob. 11ECh. 12 - Prob. 12ECh. 12 - Prob. 13ECh. 12 - Prob. 14ECh. 12 - Prob. 15ECh. 12 - Prob. 16ECh. 12 - Prob. 17ECh. 12 - The statement of members equity for Bonanza, LLC,...Ch. 12 - Distribution of cash upon liquidation Hewitt and...Ch. 12 - Distribution of cash upon liquidation David Oliver...Ch. 12 - Liquidating partnershipscapital deficiency Lewis,...Ch. 12 - Prob. 22ECh. 12 - Prob. 23ECh. 12 - Statement of partnership liquidation After closing...Ch. 12 - Prob. 25ECh. 12 - Prob. 26ECh. 12 - The accounting firm of Deloitte Touche is the...Ch. 12 - Prob. 28ECh. 12 - Prob. 1PACh. 12 - Prob. 2PACh. 12 - Prob. 3PACh. 12 - Prob. 4PACh. 12 - Statement of partnership liquidation After the...Ch. 12 - Prob. 6PACh. 12 - Prob. 1PBCh. 12 - Prob. 2PBCh. 12 - Prob. 3PBCh. 12 - Prob. 4PBCh. 12 - Statement of partnership liquidation After the...Ch. 12 - On August 3, the firm of Chapelle, Rock, and Pryor...Ch. 12 - Prob. 1CPCh. 12 - Prob. 2CPCh. 12 - Prob. 3CPCh. 12 - Prob. 4CP
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