Nicholas Miller

Date: 10/25/2024
E 16-13

1)

Income Allocation Schedule

Amount
Total
Net Income of Partnership $ 30,000
Less: Bonus to Kat (1,500)
Less: Salary to Partners (25,000)
Remaining Profit and Loss to be Divided 3,500
Distribution of Profit and Loss (3,500)
Allocation of Income $ -

2)

Journal
Date Account Debit Credit
N/A Revenue and Expense Summary 30,000
Kat Capital 13,250
Edd Capital 16,750
(To record the allocation of
net income)

N/A Kat Capital 15,000

Kat Drawing 15,000
(To record Kat's drawing and
close it to Kat's capital)

N/A Edd Capital 10,000

Edd Drawing+B29:B37 10,000
(To record Edd's drawing and
close it to Edd's capital)

3)
Capital Balances Statement
For the Year Ending December 31, 2011
Amount
Kat Edd
Balance on January 1, 2011 $ 496,750 $ 268,250
 Add: Further Investments 5,000 5,000
Less: Drawings (15,000) (10,000)
Add: Net Income for the Year 2011 13,250 16,750
Balance on December 31, 2011 $ 500,000 $ 280,000

P 16-2

1)

2)

P 16-12

1)
 Journal
Date Account Debit Credit
Dec. 31 Service Revenue 50,000
Supplies Expense 17,000
Utlities Expense 4,000
Other Miscellaneous Expenses 5,000
Profit and Loss 24,000

(To record closing of expenses and

revenue to profit and loss account)

Dec. 31 Par Capital 8,000

Boo Capital 10,000
Salaries Expense 18,000
(To record closing of salaries to
capital accounts of partners)

Dec. 31 Profit and Loss 24,000

Par Capital 12,000
Boo Capital 12,000

(To close profit and loss by allocating

profit equally among the partners)

2)
3)

Par and Boo Partnership

Schedule of Profit and Loss Distribution
For the Period Endind Dec. 31, 2011
Total Par
Net Income $ 24,000
Salary to Partners (18,000) 8,000
Remainder to Divide 6,000
Interest Allowance:
Par: 28,000 x 12% x 10/12 (2,800) 2,800
Boo: 36,000 x 12% x 10/12 (3,600)
Loss to Divide (400)
Divide Loss 400 (200)
Distribution of Income $ - $ 10,600
 Amount
Kat Edd

1,500
10,000 15,000

1,750 1,750
$ 13,250 $ 16,750
Assets:
Cash (20,000 + 95,000)
Accounts Receivalbe - Net
Inventories
Plant Assets - Net (120,000 + 120,000)
Goodwill (215,000 x 1/3 = 645,000) --> (645,000 - 390,000 - 215,000)
Total Assets

Assets:
Cash (20,000 + 95,000)
Accounts Receivalbe - Net
Inventories
Plant Assets - Net (100,000 + 120,000)
Total Assets
 Computation of Average Capital Balance
Par
30,000 x 2 months = 60,000
26,000 x 5 months = 130,000
30,000 x 3 months = 90,000
Total = $280,000

280,000 / 10 months = 28,000

Boo

10,000

3,600

(200)
$ 13,400
 Partnership of Mor, Osc,
Balance Sheet
For the Date January 2

(20,000 + 95,000) $ 115,000

nts Receivalbe - Net 100,000
200,000
Assets - Net (120,000 + 120,000) 240,000
will (215,000 x 1/3 = 645,000) --> (645,000 - 390,000 - 215,000) 40,000
$ 695,000

Partnership of Mor, Osc,

Balance Sheet
For the Date January 2

(20,000 + 95,000) $ 115,000

nts Receivalbe - Net 100,000
50,000
Assets - Net (100,000 + 120,000) 220,000
$ 485,000
 Par and Boo Partners
Capital Balance State
For the Period Ending Decem
Par
Investments March 1, 2011 $ 30,000
Add: Further Investments
July 1 by Boo
October 1 by Par 4,000
Less: Withdrawl by Par on May 2, 2011 (4,000)
Less: Monthy Salaries as Drawings (800 x 10) (1000 x 10) (8,000)
Net Capital Contribution 22,000
Add: Net Income of Partnership * See Note 10,625
Balance December 31, 2011 $ 32,625
 Note:
Statement Showing Distribution o
Net Income
Net Income for the Year $ 24,000
Salary Allowances (18,000)
Profit to be Distributed 6,000
Dived in Average Capital Ratios:
Par 28/64 (2,625)
Boo 36/64 (3,375)
Distribution of Income $ -

Computation of Average Capital Balance

Boo
30,000 x 4 months = 120,000
40,000 x 6 months = 240,000
Total = $360,000

360,000 / 10 months = 36,000

s = 28,000
ership of Mor, Osc, and Tre
Balance Sheet
the Date January 2, 2011

ership of Mor, Osc, and Tre

Balance Sheet
the Date January 2, 2011
ar and Boo Partnership
pital Balance Statement
riod Ending December 31, 2011
Boo
$ 30,000

10,000

(10,000)
30,000
13,375
$ 43,375
owing Distribution of Profit and Loss
Par

8,000

2,625

$ 10,625

Boo
months = 120,000
months = 240,000
= $360,000

0 months = 36,000
sc, and Tre
et
y 2, 2011

Liabilities and Stockholder's Equity :

Accounts Payable
Mor Capital 1/3 (120,000 + ((440,000 - 270,000)/2)+(40,000/2))
Osc Capital 1/3 (100,000 + ((440,000 - 270,000)/2)+(40,000/2))
Tre Capital 1/3 (95,000 + 120,000)

Total Liabilities and Stockholder's Equity

sc, and Tre

et
y 2, 2011

Liabilities and Stockholder's Equity :

Accounts Payable
Mor Capital 1/3 (120,000 + 35,000) *See Note
Osc Capital 1/3 (100,000 + 35,000) *See Note
Tre Capital 1/3 ((215,000 + 220,000) x 1/3) * See Note
Total Liabilities and Stockholder's Equity

Note:
* 215,000 - 1/3 share of (215,000 + 220,000)
215,000 - 145,000
$70,000
nership
atement
ember 31, 2011
Total
$ 60,000

10,000
4,000
(4,000)
(18,000)
52,000
24,000
$ 76,000
n of Profit and Loss
Boo

10,000

3,375
$ 13,375
$ 50,000
225,000
205,000
215,000

$ 695,000

$ 50,000
155,000
135,000
145,000
$ 485,000