By what amount should Jen and Fred capital account change

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Reference no: EM132759891

Question - Jen, Raks, and Fred are partners with average capital balances during 2019 of P945,000, P477,300, and P324,700, respectively. The partners receive 10% interest on their average capital balances; after deducting salaries of P244,650 to Jen and P165,250 to Fred, the residual profits or loss is divided equally. In 2019, the partnership had a net loss of P251,248 before the interest and salaries to partners. By what amount should Jen's and Fred's capital account change - increase (decrease)?

a. Jen, P60,534; Fred, (P80,896)

b. Jen, P58,952; Fred, P35,072

c. Jen, P56,716; Fred, P64,916

d. Jen, P81,688; Fred, P62,470

Reference no: EM132759891

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