Question
In: Accounting
On December 31, 2014, LBM Partnership’s accounts show the following. Answer the following questions under the...
On December 31, 2014, LBM Partnership’s accounts show the following. Answer the following questions under the different scenarios.
|
Partner |
Drawings |
Capital |
|
Lisa |
$23,000 |
$48,000 |
|
Bart |
14,000 |
30,000 |
|
Maggie |
10,000 |
25,000 |
Scenario1: Net income for the year is $30,000. Income is shared 60% to Lisa, 30% to Bart, and 10% to Maggie. How much is each partner’s share of the income?
|
Lisa |
|
|
Bart |
|
|
Maggie |
Scenario 2: Net income was $60,000 for the year. Lisa and Bart are each given a $15,000 salary allowance. The remainder is shared equally. Prepare a schedule showing the division of net income.
|
Lisa |
Bart |
Maggie |
Total |
|
|
Salary allowance |
||||
|
Remaining income |
||||
|
Total division of net income |
Scenario 3: Net income was $24,000 for the year. Each partner is given a 10% interest on beginning capital balances. Lisa is given a $10,000 salary allowance and $5,000 is given to both Bart and Maggie. The remainder is shared equally. Prepare a schedule showing the division of net income.
|
Lisa |
Bart |
Maggie |
Total |
|
|
Salary allowance |
||||
|
Interest allowance on capital |
||||
|
Total salaries and interest |
||||
|
Remaining deficiency |
||||
|
Total division of net income |
Prepare a partners' capital statement for the year under scenario 3.
|
Partners’ Capital Statement |
||||
|
Lisa |
Bart |
Maggie |
Total |
|
Solutions
Expert Solution
Scenario1: Net income for the year is $30,000. Income is shared 60% to Lisa, 30% to Bart, and 10% to Maggie. How much is each partner’s share of the income?
| Lisa | =30000*0.6 | 18000 |
| Bart | =30000*0.3 | 9000 |
| Maggie | =30000*0.1 | 3000 |
Scenario 2: Net income was $60,000 for the year. Lisa and Bart are each given a $15,000 salary allowance. The remainder is shared equally. Prepare a schedule showing the division of net income.
| Lisa | Bart | Maggie | Total | |
| Salary allowance | 15000 | 15000 | 15000 | 45000 |
| Remaining income 15000/3 | 5000 | 5000 | 5000 | 15000 |
| Total division of net income | 20000 | 20000 | 20000 | 60000 |
Net income was $24,000 for the year. Each partner is given a 10% interest on beginning capital balances. Lisa is given a $10,000 salary allowance and $5,000 is given to both Bart and Maggie. The remainder is shared equally. Prepare a schedule showing the division of net income.
| Lisa | Bart | Maggie | Total | |
| Salary allowance | 10000 | 5000 | 5000 | 20000 |
| Interest allowance on capital | 4800 | 3000 | 2500 | 10300 |
| Total salaries and interest | 14800 | 8000 | 7500 | 30300 |
| Remaining deficiency | 2000 | 2000 | 2000 | -6000 |
| Total division of net income | 16800 | 10000 | 9500 | 24300 |
Prepare a partners' capital statement for the year under scenario 3.
| Partners’ Capital Statement | ||||
| Lisa | Bart | Maggie | Total | |
| Beginning Capital | 48000 | 30000 | 25000 | 103000 |
| Add Investment | 0 | 0 | 0 | 0 |
| Less Drawings | 23000 | 14000 | 10000 | 47000 |
| Total division of net income | 16800 | 10000 | 9500 | 24300 |
| Capital At the End | 41800 | 26000 | 24500 | 92300 |
ekkarill92 answered 2 years agoRelated Solutions
Ben Cartwright Pest Control has the following balances in selected accounts on December 31, 2014. Accounts...
Ben Cartwright Pest Control has the following balances in
selected accounts on December 31, 2014.
Accounts Receivable € 0
Accumulated Depreciation – Equipment 0
Equipment 6,650
Interest Payable 0
Notes Payable 20,000
Prepaid Insurance 3,000
Salaries and Wages Payable 0
Supplies 2,940
Unearned Service Revenue 36,000
All of the accounts have normal balances. The information below
has been gathered at December 31, 2014.
1. Depreciation on the equipment for 2014 is €1,250.
2. Ben Cartwright Pest Control borrowed €20,000 by...
George Products had sales of $13,000,000 for 2014. On December 31, 2014, the balance in Accounts...
George Products had sales of $13,000,000 for 2014. On December
31, 2014, the balance in Accounts Receivable was $4,500,000. An
aging analysis of the accounts receivable indicated that $125,000
in accounts are expected to be uncollectible.
Prepare the adjusting entry to record estimated bad debts
expense using the percentage of receivables basis under each of the
following independent assumptions:
Allowance for Doubtful Accounts has a credit balance of $2,300
before adjustment.
Allowance for Doubtful Accounts has a debit...
The stockholders equity accounts of G.K. Chesterton Company have the following balances on December 31, 2014....
The stockholders equity accounts of G.K. Chesterton Company have the following balances on December 31, 2014.
Common stock, $10 par, 343,000 shares issued and outstanding $3,430,000
Paid-in capital in excess of common stock 1,299,000
Retained earnings 5,676,000
Shares of G.K. Chesterton Company stock are currently selling on the Midwest Stock Exchange at $39.
Prepare the appropriate journal entries for each of the following cases. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no...
The following is a list of the accounts and balances taken from the adjusted trial balance at December 31, 2014 for Meilleur Merchants. The list of accounts is in alphabetical order.
The following is a list of the accounts and balances taken from the adjusted trial balance at December 31, 2014 for Meilleur Merchants. The list of accounts is in alphabetical order.Meilleur uses a periodic inventory system. Account Balance Dec. 31 1 Accounts payable (15,000)2 Accounts receivable 30,000 3 Accumulated depreciation—building (15,500)4 Accumulated depreciation—equipment (10,000)5 Advertising expense 4,100 6 Building 84,600 7 S. Meilleur, capital (75,000)8 S. Meilleur, drawings 28,300 9 Cash 8,790 10 Depreciation expense 5,700 11 Equipment 24,500 12 ...
The following is a list of the accounts and balances taken from the adjusted trial balance at December 31, 2014 for Meilleur Merchants. The list of accounts is in alphabetical order.
The following is a list of the accounts and balances taken from the adjusted trial balance at December 31, 2014 for Meilleur Merchants. The list of accounts is in alphabetical order.Meilleur uses a periodic inventory system. Account Balance Dec. 31 1 Accounts payable (15,000)2 Accounts receivable 30,000 3 Accumulated depreciation—building (15,500)4 Accumulated depreciation—equipment (10,000)5 Advertising expense 4,100 6 Building 84,600 7 S. Meilleur, capital (75,000)8 S. Meilleur, drawings 28,300 9 Cash 8,790 10 Depreciation expense 5,700 11 Equipment 24,500 12 ...
Boatwig, Corp. Balance Sheet December 31, 2013 and December 31, 2014 2013 Dr. Cr. 2014 Assets...
Boatwig, Corp.
Balance Sheet
December 31, 2013 and December 31, 2014
2013
Dr.
Cr.
2014
Assets
Cash
$19,000
$71,000
Accounts Receivable
66,000
84,000
Inventory
185,000
184,000
Land
113,000
67,000
Equipment
195,000
256,000
Accummulated Depreciation
(42,000)
(69,000)
Total
$536,000
$593,000
Liabilities and Stockholders' Equity
Accounts Payable
$44,000
$36,000
Bonds Payable
198,000
143,000
Common Stock
167,000
222,000
Retained Earnings
127,000
192,000
Total
$536,000
-
...
Use the following information to answer the next two questions On December 31, 2012, Shasha Corporation...
Use the following information to answer the next two
questions
On December 31, 2012, Shasha Corporation made an adjusting
entry to recognize the correct amount of unearned revenue now
earned. Originally, the revenue was recorded in a real account when
received.
1. The journal entry on December 31, 2012 would include a
debit to which type of account?
A. Asset
B. Liability
C. Owners’ Equity
D. Revenue
E. Expense
2. The journal entry on December 31, 2012 would include a...
Use the following to answer the next four questions: During the fiscal year ended December 31,...
Use the following to answer the next four questions:
During the fiscal year ended December 31, 2019, the City of
Johnstown issued 6% general obligation serial bonds in the amount
of $2,000,000 and received $2,040,000 and used $1,980,000 of the
proceeds to construct a police station. The $40,000 premium was
transferred to a debt service fund. The $20,000 left in the capital
projects fund at the end of the project was later transferred to
the debt service fund. The bonds...
The balance sheets of Dolan Company, for December 31, 2014 and 2013, are as follows: 2014...
The balance sheets of Dolan Company, for December 31, 2014 and
2013, are as follows:
2014
2013
Cash
$ 68,000
$ 42,500
Accounts receivable (net)
61,000
70,200
Inventories
121,000
105,000
Investments
.....
100,000
Equipment
515,000
425,000
Accumulated depreciation-equipment
(153,000)
(175,000)
$612,000
$567,700
Accounts payable
$ 59,750
$ 47,250
Bonds payable, due 2010
.....
75,000
Common stock, $20 par
375,000
325,000
Premium on common stock
50,000
25,000
Retained earnings
127,250
95,450
$612,000
$567,700
Additional information:
(a)
Net income, $71,800.
(b)
Depreciation reported on income statement,...
The following are the financial statements of Chromium Ltd for the period ended 31 December 2014....
The following are the financial statements of Chromium Ltd for
the period ended 31 December 2014.
Statement of comprehensive income for Chromium Ltd for
period ended 31 December 2014
Item
Amount (R)
Sales revenue
300 000
Cost of sales
195 000
Gross profit
105 000
Selling expenses
40 000
General and administration expenses
11 000
Depreciation
10 000
Total operating expenses
61 000
Profit before interest and taxes
44 000
Interest paid
12 000
Profit before taxes
32 000
Taxes...
ADVERTISEMENT
ADVERTISEMENT
Latest Questions
- How Can Hominin Evolution be characterized as " mosaic evolution" Use examples of species from the...
- Absorption and Variable Costing Income Statements for Two Months and Analysis During the first month of...
- Mobile and wireless devices are being increasingly used in the Business Administration and Management Industry. write...
- What are the options that might be considered in relation to introducing flexible work practices? What...
- Question 2 : Aggregate Scores: Write a program that opens 2 files, quiz.txt, and hw.txt. The...
- Define the term symbiosis specifically as it applies in a biological context. Compare and contrast parasitism,...
- A research team conducted a study showing that approximately 20% of all businessmen who wear ties...
ADVERTISEMENT