CalculationsandJournalEntriesfortheAllocationofPartnershipProfitorLoss Net income for Levin-Tom partner ship for 20X9 was $125,000. Levin and Tom have agreed to
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Question:
CalculationsandJournalEntriesfortheAllocationofPartnershipProfitorLoss Net income for Levin-Tom partner ship for 20X9 was $125,000. Levin and Tom have agreed to distribute partner ship net income according to the following plan:
Additional information for 20X9 follows:
- Levin began they ear with a capital balance of $75,000.
- Tom began the year with a capital balance of $100,000.
- On March 1,Levin invested an additional $25,000 into the partnership.
- On October 1,Tom invested an additional $20,000 into the partnership.
- Throughout 20X9, each partner withdrew $200 per week in anticipation of partnership net income. The partners agreed thatthesewithdrawalsarenottobeincludedinthecomputationofaveragecapitalbalancesforpurposesofincomedistributions.
Required:
- Prepareaschedulethatdisclosesthedistributionofpartnershipnetincomefor20X9.Showsupportingcomputationsingood form.
- Prepare the statement of partners' capital at December 31, 20X9.
- Howwouldyouranswertopartachangeifalloftheprovisionsoftheincomedistributionplanwerethesameexceptthatthesalarieswere$45,000 to Levin and $60,000 to Tom?
Related Book For
Managerial accounting
ISBN: 978-0471467854
1st edition
Authors: ramji balakrishnan, k. s i varamakrishnan, Geoffrey b. sprin
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