Wong, Auni, and Divya are partners and close partnership accounts to 31 December annually. The business...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
Wong, Auni, and Divya are partners and close partnership accounts to 31 December annually. The business accounts show a net loss before taxation of RM95,000 for the year ended 31 December 2017. Business expenses include depreciation, donations and bad debts (general provision of bad debts) amounting to RM18,000, RM3,500 and RM8,000 respectively. The partnership is eligible to claim capital allowance of RM10,000 and balancing charge of RM6,000. The partnership agreement provides for an annual salary of RM36,000 to Wong and RM42,000 to Auni and Divya respectively. An annual interest on capital for each partner is 5%. Wong, Auni, and Divya contributed capital amounted to RM80,000, RM100,000 and RM110,000 respectively with profit sharing ratio 2:1:2. On 1 July 2017, Ikram joined the partnership and contributed RM50,000 as a capital. He received salary of RM2,000 per month. New profit sharing ratio was 1:1:1:1. Other terms in the partnership agreement would remain the same. Required: (i) (ii) (iii) Compute the partnership's provisional adjusted income and divisible income for the year of assessment 2017. (6 marks) Compute the partner's statutory income for the year of assessment 2017. (10 marks) State the factors that determine the existence of a partnership. (4 marks) [Total. 20 marks] Wong, Auni, and Divya are partners and close partnership accounts to 31 December annually. The business accounts show a net loss before taxation of RM95,000 for the year ended 31 December 2017. Business expenses include depreciation, donations and bad debts (general provision of bad debts) amounting to RM18,000, RM3,500 and RM8,000 respectively. The partnership is eligible to claim capital allowance of RM10,000 and balancing charge of RM6,000. The partnership agreement provides for an annual salary of RM36,000 to Wong and RM42,000 to Auni and Divya respectively. An annual interest on capital for each partner is 5%. Wong, Auni, and Divya contributed capital amounted to RM80,000, RM100,000 and RM110,000 respectively with profit sharing ratio 2:1:2. On 1 July 2017, Ikram joined the partnership and contributed RM50,000 as a capital. He received salary of RM2,000 per month. New profit sharing ratio was 1:1:1:1. Other terms in the partnership agreement would remain the same. Required: (i) (ii) (iii) Compute the partnership's provisional adjusted income and divisible income for the year of assessment 2017. (6 marks) Compute the partner's statutory income for the year of assessment 2017. (10 marks) State the factors that determine the existence of a partnership. (4 marks) [Total. 20 marks]
Expert Answer:
Answer rating: 100% (QA)
i Calculation of partnerships provisional adjusted income Net loss 95000 Salaries Wong 36000 Auni 42... View the full answer
Related Book For
Cost Accounting A Managerial Emphasis
ISBN: 978-0136126638
13th Edition
Authors: Charles T. Horngren, Srikant M.Dater, George Foster, Madhav
Posted Date:
Students also viewed these accounting questions
-
Bullseye Company manufactures dartboards. Its standard cost information follows: Standard Quantity Standard Price (Rate) Standard Unit Cost Direct materials (corkboard) 200 sq ft $2.10 per sq ft $420...
-
Using the following standard unit costs and the actual cost and usage data that follow, compute the direct materials price and direct materials quantity variances. Direct materials quantity standard...
-
Haley Inc. has established the following standard unit costs: Materials: 10 Ibs. @ $6 per Ib. $ 60.00 Labor: 3 hrs. @ $15 per hr. Factory overhead: 3 hrs. @ $3.50 per hr.. Total standard cost per...
-
Figure 20.3 describes the Medicare Part D prescription drug benefi t. Look at the Web page www.partd-medicare.com/ in your area and determine the marginal coinsurance rates applicable in each...
-
What factors do you think make some organizations ineffective at managing emotions?
-
Write each claim as a mathematical statement. State the null and alternative hypotheses, and identify which represents the claim. 1. A school publicizes that the proportion of its students who are...
-
Further investigate CCP 697.060 to determine how an abstract of judgment is recorded in California.
-
Sunco processes oil into aviation fuel and heating oil. It costs $40 to purchase each 1000 barrels of oil, which is then distilled and yields 500 barrels of aviation fuel and 500 barrels of heating...
-
One these of this class is the changing landscape of operations management due to technology. The following article is a few years old, but it is the best example that I have found for how to put the...
-
As the manager of a focus group company, you are interested in optimizing the number of participants you include in focus groups for your clients. Over the past year, you ran a field experiment,...
-
Wicker Company manufactures a single product and uses a process costing system. The product goes through two sequential departments, A and B. Information relating to the companys operations for April...
-
Q4: The obtained results of the electric potential in some region is shown in the figure, where the measured equipotential lines are spaced by the same difference in potential. Q5: Q6: The magnitude...
-
How is methylation of DNA connected to the acetylation of histones and gene expression? Explain
-
If f(x) = (x + 1)(2-3x), then f(1) =
-
Wildhorse should report retained earnings, 12/31/25, at what amount? Wildhorse Corporation reports the following information: Correction of overstatement of depreciation expense in prior years, net...
-
2. Suppose a chemical firm is producing 100 units of output with MC = $8, AVC = $7, and ATC = $9. The prevailing price of the product in the market is $8.50. There are many substitutes for this...
-
Companies will have a wide variety of key performance indicators that directly relate to what?
-
The polar coordinates of a point are given. Find the rectangular coordinates of the point. (-1, - /3)
-
Global company, ethical challenges. In June 2009, the government of Vartan invited bids for the construction of a cellular telephone network. ZenTel, an experienced communications company, was eager...
-
Strategy plans and budgets are unrelated to one another do you agree? Explain.
-
What is the relevant range? What role does the relevant-range concept play in explaining how costs behave?
-
Why are accounting standards important to auditors?
-
What is the relevance of FREDs for auditors?
-
What is aSORP?
Study smarter with the SolutionInn App