Mike and Rachel form M&R Partnership. Mike Invests $40,000 cash and Rachel invests $60,000 cash. The partners agree to share income as follows: Mike gets a salary allowance of $5,000 per year and Rachel gets a salary allowance of $9,000 per year, both get an annual interest allowance of 10% on their initial investment, and any remaining balance is shared equally. Net income for the year is $30,000. Also, Mike withdrew $1,000 cash from the partnership and Rachel withdrew $2,000. Prepare a statement of partners' equity for the year ended December 31. Note: Do not round intermediate calculations. Enter all allowances as positive values. Enter losses and withdrawals as negative values. M&R PARTNERSHIP Statement of Partners' Equity For Year Ended December 31 Initial partnership investments i Net income Total net income Total Mike Rachel Total

Mike and Rachel form M&R Partnership. Mike Invests $40,000 cash and Rachel invests $60,000 cash. The partners agree to share income as follows: Mike gets a salary allowance of $5,000 per year and Rachel gets a salary allowance of $9,000 per year, both get an annual interest allowance of 10% on their initial investment, and any remaining balance is shared equally. Net income for the year is $30,000. Also, Mike withdrew $1,000 cash from the partnership and Rachel withdrew $2,000. Prepare a statement of partners' equity for the year ended December 31. Note: Do not round intermediate calculations. Enter all allowances as positive values. Enter losses and withdrawals as negative values. M&R PARTNERSHIP Statement of Partners' Equity For Year Ended December 31 Initial partnership investments i Net income Total net income Total Mike Rachel Total

SWFT Comprehensive Vol 2020

43rd Edition

ISBN:9780357391723

Author:Maloney

Publisher:Maloney

Chapter21: Partnerships

Section: Chapter Questions

Problem 2BCRQ

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Arun and Margot want to admit Tammy as a third partner for their partnership. Their capital balances prior to Tammys admission are $50,000 each. Prepare a schedule showing how the bonus should be divided among the three, assuming the profit or loss agreement will be 1:3 once Tammy has been admitted and her contribution is: A. $20,000 B. $80,000 C. $50,000. In addition, show the resulting journal entries to each of the three partners capital accounts.
The partnership of Tasha and Bill shares profits and losses in a 50:50 ratio, and the partners have capital balances of $45,000 each. Prepare a schedule showing how the bonus should be divided if Ashanti joins the partnership with a $60,000 investment. The partners new agreement will share profit and loss in a 1:3 ratio.
The partnership of Tatum and Brook shares profits and losses in a 60:40 ratio respectively after Tatum receives a 10,000 salary and Brook receives a 15,000 salary. Prepare a schedule showing how the profit and loss should be divided, assuming the profit or loss for the year is: A. $40,000 B. $25,000 C. ($5,000) In addition, show the resulting entries to each partners capital account. Tatums capital account balance is $50,000 and Brooks is $60,000.
The partnership of Magda and Sue shares profits and losses in a 50:50 ratio after Mary receives a $7,000 salary and Sue receives a $6,500 salary. Prepare a schedule showing how the profit and loss should be divided, assuming the profit or loss for the year is: A. $10,000 B. $5,000 C. ($12,000) In addition, show the resulting entries to each partners capital account.
Mike and Rachel form M&R Partnership. Mike invests $40,000 cash and Rachel invests $60,000 cash. The partners agree to share income as follows: Mike gets a salary allowance of $5,000 per year and Rachel gets a salary allowance of $9,000 per year; both get an annual interest allowance of 10% on their initial investment; and any remaining balance is shared equally. Net income for the year is $30,000. Also, Mike withdrew $1,000 cash from the partnership and Rachel withdrew $2,000. Prepare a statement of partners’ equity for the year ended December 31.
Merkel and Putin began a partnership by investing $6,000 and $4,000, respectively. During its first year, the partnership earned $80,000. Show how the $80,000 income is allocated under each separate plan: (1) the partners share income and loss equally; (2) the partners share income and loss in proportion to their initial investments; and (3) the partners share income by giving a $35,000-per-year salary allowance to Merkel, a $13,000-per-year salary allowance to Putin, 20% interest on their initial capital investments, and any remaining balance shared 70% to Merkel and 30% to Putin.