Question : 124.Bannister invested $110,000 and Wilder invested $99,000 in a new : 1258247

 

124.Bannister invested $110,000 and Wilder invested $99,000 in a new partnership. Their partnership agreement called for Wilder to receive a $70,000 annual salary allowance. They also agreed to an annual interest allowance of 5% on the partners’ beginning-year capital balance, with the balance of income or loss to be divided equally. Under this agreement, what are the income or loss shares of the partners if the annual partnership income is $82,000?    

125.Bannister invested $110,000 and Wilder invested $99,000 in a new partnership. Their partnership agreement called for Wilder to receive a $70,000 annual salary allowance. Under this agreement, what are the income or loss shares of the partners if the annual partnership income is $90,000?   

126.Fallon and Springer formed a partnership on January 1. Fallon contributed $90,000 cash and equipment with a market value of $60,000. Springer’s investment consisted of: cash, $30,000; inventory, $20,000; all at market values. Partnership net income for Year 1 and Year 2 was $75,000 and $120,000, respectively. 1. Determine each partner’s share of the net income for each year, assuming each of the following independent situations: (a) Income is divided based on the partners’ failure to sign an agreement. (b) Income is divided based on a 2:1 ratio (Fallon: Springer). (c) Income is divided based on the ratio of the partners’ original capital investments. (d) Income is divided based on interest allowance of 12% on the original capital investments; salary allowance to Fallon of $30,000 and Springer of $25,000; and the remainder to be divided equally. 2. Prepare the journal entry to record the allocation of the Year 1 income under alternative (d) above.    

127.Lin and Coral invested $99,000 and $126,000, respectively, in a partnership they began one year ago. Assuming the partnership earned $120,000 during the current year; compute the share of the net income each partner should receive under each of these independent assumptions. 1. The partnership contract specifies salary allowances of $45,000 to Lin and $60,000 to Coral, and any balance shared equally. 

LinCoralAllocated

Net Income

Salary allowance

Remainder

Allocation of remainder

Total

2. The partnership contract specifies salary allowances of $45,000 to Lin and $60,000 to Coral, interest allowance of 10% on the partners’ beginning capital balance for the year. 

LinCoralAllocated

Net Income

Salary allowance

Interest allowance

Remainder

Allocation of remainder

Total

 128.Glade, Marker, and Walters are partners with beginning-year capital balances of $100,000, $50,000, and $50,000, respectively. Partnership net income for the year is $84,000. Make the necessary journal entry to close Income Summary to the capital accounts if:a. Partners agree to divide income based on their beginning-year capital balances.b. Partners agree to divide income based on the ratio of 5:3:2 (Glade:Marker:Walters), respectively.c. Partnership agreement is silent as to division of income and less.    

 

 

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