The partnership agreement of A, B and C provides for the year-end allocation of net income in the following order: First, A is to receive 10% of net income up to P100,000 and 15% over P100,000 Second, B and C each are to receive 10% of the remaining income over P150,000. The balance of income is to be allocated equally among the three partners. The partnership’s 2021 net income was P280,000 before any allocations to partners. What amount should be allocated to A? Group of answer choices 111,800 93,333 103,000
Partnership Accounting
A partnership is a kind of arrangement between two or more people whereby they agree to manage the business operations and share its profits and losses in an agreed ratio between them. The agreement that is drafted and signed by the partners of the firm is termed as partnership deed and contains various important clauses agreed between the partners such as profit/loss sharing, interest on capital, remuneration allocation of each partner, drawings, admission of a new partner, etc.
Partner Admission and Withdrawal
A partnership is a kind of arrangement between two or more people whereby they agree to manage the business operations and share its profits and losses in an agreed ratio between them. The agreement that is drafted and signed by the partners of the firm is termed as a partnership deed and contains various important clauses agreed between the partners such as profit/loss sharing, interest on capital, remuneration allocation of each partner, drawings of a partner, etc.
The
First, A is to receive 10% of net income up to P100,000 and 15% over P100,000
Second, B and C each are to receive 10% of the remaining income over P150,000. The balance of income is to be allocated equally among the three partners.
The partnership’s 2021 net income was P280,000 before any allocations to partners. What amount should be allocated to A?
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