The partnership of Angel Investor Associates began operations on January 1, 2008, with contributions from two partners
Question:
The partnership of Angel Investor Associates began operations on January 1, 2008, with contributions from two partners as follows:
Jan Strous $36,000 Lisa Lankford 84,000
The following additional partner transactions took place during the year:
1. In early January, Sarah Rogers is admitted to the partnership by contributing $30,000 cash for a 20% interest.
2. Net income of $140,000 was earned in 2008. In addition, Jan Strous received a salary allowance of $25,000 for the year. The three partners agree to an income-sharing ratio equal to their capital balances after admitting Rogers.
3. The partners' withdrawals are equal to half of the increase in their capital balances resulting from income remaining after salary allowances.
Prepare a statement of partnership equity for the year ended December 31, 2008.
A legal form of business operation between two or more individuals who share management and profits. A Written agreement between two or more individuals who join as partners to form and carry on a for-profit business. Among other things, it states...
Step by Step Answer:
Accounting
ISBN: 978-0324401844
22nd Edition
Authors: Carl S. Warren, James M. Reeve, Jonathan E. Duchac