College Accounting, Chapters 1-27
College Accounting, Chapters 1-27
23rd Edition
ISBN: 9781337794756
Author: HEINTZ, James A.
Publisher: Cengage Learning,
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Chapter 19, Problem 2CE
To determine

Ascertain the amount of net income allocated to each partner.

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Rodgers and Winter had capital balances of $60,000 and $90,000, respectively, at the beginning of the current fiscal year. The articles of partnership provide for salary allowances of $25,000 and $30,000, respectively; an allowance of interest at 12% on the capital balances at the beginning of the year; and the remaining net income divided equally. Net income for the current year was $110,000. a.  Present the Division of net income section of the income statement for the current year. excess allowance over net inome/remaining income Net income     $110,000                         Rodgers Winter Total   Division of net income:                 Salary allowance $   $   $       Interest allowance                  Total                                 Net income $   $   $     b.  Assuming that the net income had been $65,000 instead of $110,000, present the Division of net income section of the income statement for the current year. excess allowance over net…
Partners De Guzman and Tugade recueve a salary allowance of 30,000 and 70,000, respectively, and share the remainder equally. if the company earned 40,000 during the period, what is the effect on tugades capital
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