(25%) Top and Middle are in partnership, sharing profits and losses in proportion 75% and 25%. The partnership agreement provided as follows: (a) Interest at the rate of 10% per annum is to be allowed on the partners’ Capital Account balances. (b) Interest on drawings was to be calculated at 4% per annum. (c) Top was allowed a salary of RM400 per month. (d) Interest on partner loan was 6% per annum. Trial Balance As At 31 December 2009 RM Capital : Top : Middle Current Account : Top : Middle Drawings
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| | | | | | Date | | Account Titles and Explanation | P. R. | Debit | Credit | a. | | Other Assets - Starting balance | | | 106,000 | | | | | Sale of Other Assets | | | | 85,000 | | | | | Balance Remaining; Loss | | 21,000 | | | | | | | | | | | | | | $21,000 divided by total of all ratios 10 = $2,100 | | | | | | Sand has 1 share of the partnership | | | | | | | 2,100 x 1 = 2,100 |
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| | | |DISSOLUTION AND LIQUIDATION OF A PARTNERSHIP | | | |
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GAAP ACCOUNTING FOR PARTNERSHIPS Formation [i]. The Revised Uniform Partnership Act defines a partnership as a. Any association of two or more persons or entities. b. An association of two or more persons to carry on as co-owners a business for profit. c. A separate legal entity for most legal purposes. d. An entity created by following statutory requirements. Gleim [ii]. The partnership agreement is an express contract among the partners (the owners of the business). Such an
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STEEBY VS FIAL Tort Liability Charles Fial and Roger J. Steeby entered into a partnership called Audit Consultants to perform auditing services. Pursuant to the agreement, they shared equally the equity, income, and profits of the partnership. Originally, they performed the auditing services themselves, but as business increased, they engaged independent contractors to do some of the audit work. Fial’s activities generated approximately 80 percent of the partnership’s revenues. Unhappy with their
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side of one accounting and on the credit side of another account. ▪ The debit entry is made in the account which is receiving the value and the credit entry is made in the account which is giving the value. ▪ Each type of asset, liability, expense and income has its own ledger account. ▪ Any value taken from the business by the owner of the business is known as drawings. ▪ At the end of the period, the accounts of assets and liabilities which contain more than one entry
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sole trader, a partnership and a limited company 4 P1.5: Use of financial software in Tourism and Hospitality business 5 P1.6: Impact of changes in IT and internet on hotels and airlines 6 P2.1: Double-entry book-keeping 6 P2.2: Calculattion and account for VAT on purchases and Sales 7 P2.3: Cash receipts, cash payments and bank reconciliation 8 P3.1: How a trial balance is constructed 8 P3.2: Trial balance along with adjustments used to prepare fianl accounts
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ACC 280 Principles of Accounting Chapter Questions ACC 280 FINAL EXAM - CORRECT ANSWERS http://www.learnyourcourse.com/acc-280/545-acc-280-final-exam-8-chapter-questions.html Chapter 4 1. It is not true that current assets are assets that a company expects to 2. After closing entries are posted, the balance in the owner's capital account in the ledger will be equal to 3. When using a worksheet, adjusting entries are journalized 4. Liabilities are generally classified on
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Chapter 15 Partnerships: termination and liquidation Answers to Questions 1. A dissolution refers to the cessation of a partnership. In many cases, this process is simply a preliminary step in the transfer of business property to a newly formed partnership. Therefore, a dissolution does not necessarily affect the operations of the business. In a liquidation, however, actual business activities must cease. Partnership property is sold with the remaining cash distributed to creditors and to
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Chapter 15 Partnerships: termination and liquidation Answers to Questions 1. A dissolution refers to the cessation of a partnership. In many cases, this process is simply a preliminary step in the transfer of business property to a newly formed partnership. Therefore, a dissolution does not necessarily affect the operations of the business. In a liquidation, however, actual business activities must cease. Partnership property is sold with the remaining cash distributed to creditors
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