Reference no: EM132477668
Question 1 - Marasigan, Cabance and Cequina formed a partnership on Jan 1, 2019. Each contributed 120,000. Salaries were to be allocated as follows: Marasigan 30,000 ; Cabance 30,000 ; Cequina 45,000. Drawings were equal to salaries and to be taken out evenly throughout the year. With sufficient partnership profit, Marasigan and Cabance could split a bonus equal to 25% of partnership profit after salaries and bonus ( in no event could the bonus go below zero).
Remaining profits were to be split as follows: 30% for Marasigan, 30% for Cabance and 40% for Cequina. For the year, partnership profit was 120,000. Compute the ending capital for each partner:
a. Marasigan, 125,100; Cabance, 125,100; Cequina 124,800
b. Marasigan, 126,000; Cabance, 126,000; Cequina, 124,500
c. Marasigan, 125,500; Cabance, 125,500; Cequina, 124,000
d. Marasigan, 155,100; Cabance, 155,100; Cequina, 169,800
Question 2 - Del Mundo, Ballada and Mendoza are partners sharing profit on a 7:2:1 ratio. Burgos was admitted into the partnership with 15% share in profit on Jan. 1,2019. The old partners continue to share profit in their original ratios.
For the year 2019, the partnership showed a profit of 15,000. However, it was discovered that the following items were omitted in the firm's book:
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Unrecorded at year end:
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2018
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2019
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Accrued Expense
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P 1,050
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Accrued Income
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875
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Prepaid Expense
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1,400
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Unearned Income
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1,225
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Calculate the share of Ballada in the 2019 profit?
a. 2,197.50
b. 2,637.00
c. 2,490.50
d. 3,149.75.