Question Details

(Solved) (Latest ver. Aug 2020) - Journalize partnership transactions/ Income allocations

Brief item decscription


Item details:

Question:

Kelley and Eckert formed a partnership, Eckert invested $82,500 in cash and Kelley invested land valued at $60,000 and a bldg valued at $100,000. The partnership also assumed responsibility of Kelley's $92,500 long-term note payable associated w/the land and bldg. They agreed to share income, Eckert to receive and annyal salary allowance of $25,000, both receive an annual interest allowance of 10% of their beginning year capital investment, any remaining income or loss to be shared equally. On 20 Oct Eckert withdrew $34,000 cash and Kelley withdrew $20,000 cash. Afer the adjusting and closing entries are made to the revenue and expense accounts at 31 Dec, the Income Summary account had a credit balance of $90,000.

Prepare journal entries to record 1)the partners initial capital investments, b) their cash withdrawals, and c) the 31 Dec closing of both the withdrawls and Income Summary accounts.

and determine the balances of the partners' capital accounts as of 31 Dec 08.

Kramer and Knox began a partnership by investing $60,000 and $80,000 respectively. The first year the partnership earned $160,000. Prepare calculations showing how the $160,000 income should be allocated to the partners under each of the following three seperate plans for sharing income and loss.

(1) the partners failed to agree on a method to share income (2) the partners agreed to share income and loss in proportion to their initial investments (round to nearest dollar) (3) the partners agreed toshare income by granting a $50,000 per year salary to Kramer and a $40,000 salary to Knox, 10% interest on their initial capital investments, and the remaining balance shared equally.

 







About this question:
STATUS
Answered
QUALITY
Approved
ANSWER RATING

This question was answered on: Sep 16, 2020

PRICE: $11.5

Solution~00010506.zip (18.37 KB)

Buy this answer for only: $11.5

Pay using PayPal (No PayPal account Required) or your credit card. All your purchases are securely protected by PayPal.
SiteLock

Need a similar solution fast, written anew from scratch? Place your own custom order

We have top-notch tutors who can help you with your essay at a reasonable cost and then you can simply use that essay as a template to build your own arguments. This we believe is a better way of understanding a problem and makes use of the efficiency of time of the student. New solution orders are original solutions and precise to your writing instruction requirements. Place a New Order using the button below.

Order Now