How much is the share of aa in the partnership profits

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Reference no: EM133136238

Question - AA and BB are partners with capital accounts that had the following transactions during 2022:


AA

BB


Debit

Credit

Debit

Credit

Beginning balance, January 1


P270,000


P280,000

February 28

P80,000




March 1




120,000

April 30


160,000



June 1



P100,000


August 1




140,000

September 30


40,000



October 31



40,000


The partnership agreement provides for the following:

1. Interest of 9% is to be provided to AA

2. Salaries of P4,000 is to be given to BB per quarter

3. A bonus of 25% is to be given to AA based on net income after interest and salaries

4. Remaining balance is to be allocated on a ratio of 40:60.

The income summary account has a credit balance of P1,050,000 before profit distribution. BB has a Drawing account amounting to P40,000 which is a withdrawal made by BB in anticipation of future profits on July 1, 2022.

Required - How much is the share of AA in the partnership profits?

Reference no: EM133136238

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