Required information [The following information applies to the questions display
ID: 2391897 • Letter: R
Question
Required information
[The following information applies to the questions displayed below.]
Mo Meek, Lu Ling, and Barb Beck formed the MLB Partnership by making capital contributions of $80,100, $311,500, and $498,400, respectively. They predict annual partnership net income of $523,500 and are considering the following alternative plans of sharing income and loss: (a) equally; (b) in the ratio of their initial capital investments; or (c) salary allowances of $85,600 to Mo, $64,200 to Lu, and $97,000 to Barb; interest allowances of 10% on their initial capital investments; and the balance shared as follows: 20% to Mo, 40% to Lu, and 40% to Barb.
rev: 09_28_2017_QC_CS-102797
Item 8 Part 2 of 3 Item Skipped
[The following information applies to the questions displayed below.]
Mo Meek, Lu Ling, and Barb Beck formed the MLB Partnership by making capital contributions of $80,100, $311,500, and $498,400, respectively. They predict annual partnership net income of $523,500 and are considering the following alternative plans of sharing income and loss: (a) equally; (b) in the ratio of their initial capital investments; or (c) salary allowances of $85,600 to Mo, $64,200 to Lu, and $97,000 to Barb; interest allowances of 10% on their initial capital investments; and the balance shared as follows: 20% to Mo, 40% to Lu, and 40% to Barb.
rev: 09_28_2017_QC_CS-102797
[The following information applies to the questions displayed below.]
Mo Meek, Lu Ling, and Barb Beck formed the MLB Partnership by making capital contributions of $80,100, $311,500, and $498,400, respectively. They predict annual partnership net income of $523,500 and are considering the following alternative plans of sharing income and loss: (a) equally; (b) in the ratio of their initial capital investments; or (c) salary allowances of $85,600 to Mo, $64,200 to Lu, and $97,000 to Barb; interest allowances of 10% on their initial capital investments; and the balance shared as follows: 20% to Mo, 40% to Lu, and 40% to Barb.
rev: 09_28_2017_QC_CS-102797
2. Prepare a statement of partners’ equity showing the allocation of income to the partners assuming they agree to use plan (c), that income earned is $523,500, and that Mo, Lu, and Barb withdraw $42,400, $56,400, and $72,400, respectively, at year-end. (Do not round intermediate calculations. Enter all allowances as positive values. Enter losses as negative values.)
Record the entry to close the partners' withdrawals accounts. (Mo, Lu, and Barb withdraw $42,400, $56,400, and $72,400, respectively, at year-end.)
Requlred Informetlon [The following information applies to the questions displayed below. Mo Meek, Lu Ling. and Barb Beck formed the MLB Partnership by making capital contributions of $80,100, $311,500, and $498.400, respectively. They predict annual partnership net income of $523,500 and are considering the following alternative plans of sharing income and loss: (a) equally: (b) in the ratio of their initial capital investments; or (c) salary allowances of $85,600 to Mo. $64,200 to Lu, and $.97,000 to Barb; interest allowances of 10% on their initial capital investments, and the balance shared as follows: 20% to Mo, 40% to Lu, and 40% to Barb. Part 1 of 3 Requlrec: 1. Use the table to show how to distribute net income of $523,500 for the calendar year under each of the alternative plans being considered. (Do not round Intermedlete calculatlons.) e (Loss) Sharing Plan n (a) Net Income (loss) Balance allocated equally Balance of income (loss) Shares to the partners Mo Lu Barb Total S 523,500 S 523,500 Mo Lu Barb Total n (b) Net Income (loss) Balance allocated in proportion to 523,500 nitial investments Balance of income (loss) 523,500 Shares to the partners n (c) Net income (oss) Salary allowances Balance of income (loss) Interest allowances Balance of income (loss) Balance allocated Balance of income (loss) Shares of the partners Mo Lu Total 523,500Explanation / Answer
3.
Plan (a) Mo Lu Barb Total Net income (loss) 523000 Balance allocated equally 33.33% 33.33% 33.33% 100% Balance of income (loss) 523000 Share to the partners 174333 174333 174333 523000 Plan (b) Mo Lu Barb Total Net income (loss) 523000 Balance allocated in proportion to initial investments 9.00% 35.00% 56.00% 100% Balance of income (loss) 523000 Share to the partners 47070 183050 292880 523000 Working: Initial investments 80100 311500 498400 890000 Proportion (%) 9% 35% 56% 100% Plan (c) Mo Lu Barb Total Net income (loss) 523000 Salary allowances 85600 64200 97000 246800 Balance of income (loss) 276200 Interest allowances 8010 31150 49840 89000 Balance of income (loss) 187200 Balance allocated (20%,40%,40%) 37440 74880 74880 187200 Share to the partners 131050 170230 221720 523000 Working: Initial investments 80100 311500 498400 890000 Interest allowances (10%) 8010 31150 49840 89000Related Questions
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