CHAPTER 13 - CHAPTER13 AccountingforPartnerships...

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CHAPTER 13 Accounting for Partnerships SOLUTIONS TO BRIEF EXERCISES BRIEF EXERCISE 13-1 Cash. .................................................................................. 10,000 Equipment. ........................................................................ 9,000 Richard Burton, Capital. .......................................... 19,000 BRIEF EXERCISE 13-2 Accounts Receivable. ...................................................... $16,000 Less: Allowance for doubtful accounts. ....................... 3,500 $12,500 Equipment. ........................................................................ 11,000 Accumulated depreciation should not be shown because a new company cannot have any accumulated depreciation. BRIEF EXERCISE 13-3 The division is: Lucy $30,000 ($50,000 X 60%) and Desi $20,000 ($50,000 X 40%). The entry is: Income Summary. .................................................... 50,000 Lucy, Capital. .................................................... 30,000 Desi, Capital. ..................................................... 20,000
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BRIEF EXERCISE 13-4 Division of Net Income Crosby Stills Nash Total Salary allowance Remaining income, $40,000: ($65,000 – $25,000) C ($40,000 X 50%) S ($40,000 X 30%) N ($40,000 X 20%) Total remainder Total division $15,000 20,000 $35,000 5,000 $ 12,000 000,000 $17,000 5,000 $ 8,000 000,000 $13,000 $25,000 40,000 $65,000
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BRIEF EXERCISE 13-5 Division of Net Income Bob Ray Total Salary allowance Interest allowance Remaining deficiency, ($13,000): [($25,000 + $12,000) – $24,000] Bob($13,000 X 50%) Ray ($13,000 X 50%) Total remainder Total division $15,000 7,000 (6,500 000,000 $15,500 ) $10,000 5,000 (6,500 000,000 8,500 $ ) $25,000 12,000 (13,000 $24,000 ) BRIEF EXERCISE 13-6 R, Capital. ............................................................................. 10,000 E, Capital. ............................................................................. 7,000 O, Capital. ............................................................................. 4,000 Cash. ............................................................................. 21,000 *BRIEF EXERCISE 13-7 Foe, Capital. ......................................................................... 11,000 Fum, Capital. ................................................................ 11,000 *BRIEF EXERCISE 13-8 Cash. ..................................................................................... 42,000 Ozzie, Capital (50% X $17,400*). ........................................ 8,700 Harriet, Capital (50% X $17,400). ....................................... 8,700
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Ricky, Capital (45% X $132,000). ................................ 59,400 *[($40,000 + $50,000 + $42,000) X 45%] – $42,000 = $17,400.
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*BRIEF EXERCISE 13-9 Elroy, Capital. ...................................................................... 20,000 George, Capital. ........................................................... 10,000
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This note was uploaded on 04/04/2009 for the course ACC 321 taught by Professor Ahmedmokhtar during the Spring '09 term at Ain Shams University.

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CHAPTER 13 - CHAPTER13 AccountingforPartnerships...

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