Question

1.) Tyler Hawes and Piper Albright formed a partnership, investing $65,000 and $195,000, respectively.

Determine their participation in the year's net income of $285,000 under each of the following independent assumptions:

- No agreement concerning division of net income.
- Divided in the ratio of original capital investment.
- Interest at the rate of 6% allowed on original investments and the remainder divided in the ratio of 2:3.
- Salary allowances of $38,000 and $47,000, respectively, and the balance divided equally.
- Allowance of interest at the rate of 6% on original investments, salary allowances of $38,000 and $47,000, respectively, and the remainder divided equally.

2)

Martin Farley and Ashley Clark formed a limited liability company with an operating agreement that provided a salary allowance of $56,000 and $45,000 to each member, respectively. In addition, the operating agreement specified an income-sharing ratio of 3:5. The two members withdrew amounts equal to their salary allowances. Revenues were $668,000 and expenses were $520,000, for a net income of $148,000.

**a.** Determine the division of $148,000 net
income for the year.

Schedule of Division of Net Income | |||

Farley | Clark | Total | |

Salary allowance | $ | $ | $ |

Remaining income | |||

Net income | $ | $ | $ |

**b.** Provide journal entries to close the (1)
revenues and expenses and (2) drawing accounts for the two members.
For a compound transaction, if an amount box does not require an
entry, leave it blank.

(1) | |||

(2) | |||

3.)

Nettles, King, and Tanaka are partners sharing income 3:2:1. After the firm's loss from liquidation is distributed, the capital account balances were: Nettles, $18,000 Dr.; King, $66,000 Cr.; and Tanaka, $47,000 Cr.

If Nettles is personally bankrupt and unable to pay any of the $18,000, what will be the amount of cash received by King and Tanaka upon liquidation? If an amount is zero, enter in 0. Use the minus sign to indicate any deficiencies.

Amount of Cash Received | |||

Nettles | King | Tanaka | |

Capital balances after realization | $ | $ | $ |

Distribution of partner deficiency | |||

Capital balances after deficiency distribution | $ | $ | $ |

Answer #2

a) In case of agreement, profit will be divided equally.

Tyler= 285000*1/2= 142500

Piper= 142500

b) Ratio of capital investment

Tyler= 285000* 65000/(65000+195000) = 71250

Piper= 285000-71250= 213750

C) Interest

Tyler = 65000*6%= 3900

Piper = 195000*6%= 11700

Net income after interest = 285000- 3900-11700 = 269400

Tyler = 269400*2/5 = 107760

Piper = 269400-107760 = 161640

d) Tyler = 38000

Piper = 47000

Net income after salary = 285000-38000-47000= 200000

Tyler = 200000*1/2 = 100000

Piper = 100000

E)

Interest

Tyler = 65000*6%= 3900

Piper = 195000*6%= 11700

Salary

Tyler = 38000

Piper = 47000

Net income after interest and salary = 285000-3900-11700-38000-47000= 184400

Tyler = 184400*1/2 = 92200

Piper = 92200

answered by: anonymous

Tyler Hawes and Piper Albright formed a partnership, investing
$187,500 and $62,500, respectively.
Determine their participation in the year's net income of
$270,000 under each of the following independent assumptions:
No agreement concerning division of net income.
Divided in the ratio of original capital investment.
Interest at the rate of 6% allowed on original investments and
the remainder divided in the ratio of 2:3.
Salary allowances of $40,000 and $47,000, respectively, and the
balance divided equally.
Allowance of interest at...

Tyler Hawes and Piper Albright formed a partnership, investing
$180,000 and $120,000, respectively. Determine their participation
in the year's net income of $282,000 under each of the following
independent assumptions: No agreement concerning division of net
income. Divided in the ratio of original capital investment.
Interest at the rate of 18% allowed on original investments and the
remainder divided in the ratio of 2:3. Salary allowances of $48,000
and $66,000, respectively, and the balance divided equally.
Allowance of interest at...

Tyler Hawes and Piper Albright formed a partnership, investing
$62,500 and $187,500, respectively.
Determine their participation in the year's net income of
$270,000 under each of the following independent assumptions:
No agreement concerning division of net income.
Divided in the ratio of original capital investment.
Interest at the rate of 5% allowed on original investments and
the remainder divided in the ratio of 2:3.
Salary allowances of $36,000 and $48,000, respectively, and the
balance divided equally.
Allowance of interest at...

Dividing Partnership Income Tyler Hawes and Piper Albright
formed a partnership, investing $192,000 and $96,000, respectively.
Determine their participation in the year's net income of $324,000
under each of the following independent assumptions: No agreement
concerning division of net income. Divided in the ratio of original
capital investment. Interest at the rate of 12% allowed on original
investments and the remainder divided in the ratio of 2:3. Salary
allowances of $45,000 and $63,000, respectively, and the balance
divided equally. Allowance...

Dividing Partnership Income
Tyler Hawes and Piper Albright formed a partnership, investing
$369,000 and $123,000, respectively.
Determine their participation in the year's net income of
$264,000 under each of the following independent assumptions:
No agreement concerning division of net income.
Divided in the ratio of original capital investment.
Interest at the rate of 18% allowed on original investments and
the remainder divided in the ratio of 2:3.
Salary allowances of $78,000 and $108,000, respectively, and the
balance divided equally.
Allowance...

Dividing Partnership Income
Candace Hassell and Abby Lawson formed a partnership, investing
$261,000 and $87,000, respectively.
Determine their participation in the year's net income of
$372,000, under each of the following independent assumptions.
a. No agreement concerning division of net income.
b. Divided in the ratio of original capital investment.
c. Interest at the rate of 12% allowed on original investments
and the remainder divided in the ratio of 2:3.
d. Salary allowances of $55,000 and $77,000, respectively, and
the...

Martin Farley and Ashley Clark formed a limited liability
company with an operating agreement that provided a salary
allowance of $41,800 and $32,100 to each member, respectively. In
addition, the operating agreement specified an income-sharing ratio
of 3:1. The two members withdrew amounts equal to their salary
allowances. Revenues were $668,000 and expenses were $520,000, for
a net income of $148,000.
Note: The reduction in members’ equity from
withdrawals would be disclosed on the statement of members’
equity.
Required:
A....

Liquidating Partnerships—Capital Deficiency
Nettles, King, and Tanaka are partners sharing income 3:2:1.
After the firm's loss from liquidation is distributed, the capital
account balances were: Nettles, $18,000 Dr.; King, $68,000 Cr.; and
Tanaka, $45,000 Cr.
If Nettles is personally bankrupt and unable to pay any of the
$18,000, what will be the amount of cash received by King and
Tanaka upon liquidation? If an amount is zero, enter in 0. Use the
minus sign to indicate any deficiencies.
Amount of...

Dividing Partnership Income
Candace Hassell and Abby Lawson formed a partnership, investing
$387,000 and $129,000, respectively.
Determine their participation in the year's net income of
$354,000 under each of the following independent assumptions:
A) Salary allowances of $81,000 and $111,000, respectively, and
the balance divided equally.
B) Allowance of interest at the rate of 18% on original
investments, salary allowances of $81,000 and $111,000,
respectively, and the remainder divided equally.
Hassell Lawson
A = _________ ________
B = _________ ________

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.
Net...

ADVERTISEMENT

Get Answers For Free

Most questions answered within 1 hours.

ADVERTISEMENT

asked 4 minutes ago

asked 16 minutes ago

asked 24 minutes ago

asked 29 minutes ago

asked 36 minutes ago

asked 41 minutes ago

asked 42 minutes ago

asked 46 minutes ago

asked 55 minutes ago

asked 56 minutes ago

asked 57 minutes ago

asked 1 hour ago