TOPIC : DIVISION OF PROFITS AND LOSSES

PROBLEM:
Dela Joya and Marquez are partners who earned a profit amounting to P 300,000 for the year 2018.
Required :
1) Divide the profits according to the different partners agreement
2) Prepare the journal entries for problem # 9
(NOTE: FILL-IN THE YELLOW BOXES ONLY WITH THE CORRECT ANSWER)

Given: INCOME 700,000.00

EXPENSES 400,000.00
PROFIT 300,000.00
DELA JOYA MARQUEZ

ORIGINAL CAPITAL INVESTMENT 100,000.00 200,000.00

CAPITAL BALANCE AT THE BEG. OF THE YEAR 100,000.00 200,000.00
CAPITAL BALANCE AT THE END OF THE YEAR 75,000.00 150,000.00
AVERAGE CAPITAL BALANCES 50,000.00 100,000.00
INTEREST ON PARTNERS CAPITAL -ORIG. INV. 10% 20%
SALARIES TO PARTNERS 20,000.00 40,000.00
BONUS TO MANAGING PARTNER-DELA JOYA 10% OF PROFIT

PARTNERS' AGREEMENT

PROFIT 300,000.00
DELA JOYA MARQUEZ TOTAL
1. EQUALLY OR IN AN AGREED RATIO

EQUALLY 50:50 300,000 X 50% - 300,000 X 50% - -

AGREED RATIO 60:40 300,000 X 60% - 500,000 X 40% - -

 DELA JOYA MARQUEZ TOTAL
2. ORIGINAL CAPITAL INVESTMENT* 100,000.00 200,000.00 300,000.00

100/300 1/3 300,000 X 1/3 -

200/300 2/3 300,000 X 2/3 - -

DELA JOYA MARQUEZ TOTAL

3. CAPITAL AT THE BEG OF THE YEAR* 100,000.00 200,000.00 300,000.00

100/300 1/3 300,000 X 1/3 -

200/300 2/3 300,000 X 2/3 - -

DELA JOYA MARQUEZ TOTAL

4. CAPITAL AT THE END OF THE YEAR* 75,000.00 150,000.00 225,000.00

75/225 1/3 300,000 X 1/3 -

150/225 2/3 300,000 X 2/3 - -

DELA JOYA MARQUEZ TOTAL

5. AVERAGE CAPITAL BALANCES* 50,000.00 100,000.00 150,000.00

50/150 1/3 300,000 X 1/3 -

100/150 2/3 300,000 X 2/3 - -
6. INTEREST ON PARTNERS CAPITAL * ; BALANCE IN AN AGREED RATIO OF 50:50

TOTAL DELA JOYA MARQUEZ TOTAL

ORIGINAL CAPITAL INVESTMENT 100,000.00 200,000.00 300,000.00

PROFIT -
1) LESS INTEREST - 100,000.00 10% - 200,000.00 20% - -
BALANCE -
2) LESS DISTRIBUTION - 250,000 X 50% - 250,000 X 50% - -
BALANCE - - - - -

7. SALARIES TO PARTNERS *AND BALANCE ON AGREED RATIO 50:50

50% 50% 100%
TOTAL DELA JOYA MARQUEZ TOTAL

PROFIT -
1) LESS SALARIES - - - -
BALANCE -
2) LESS DISTRIBUTION - 240,000 X 50% - 240,000 X 50% - -
BALANCE - - - - -

8. BONUS TO MANAGING PARTNER CARLOTA* AND BALANCE ON AGREED RATIO 50:50

TOTAL DELA JOYA MARQUEZ TOTAL

PROFIT -
1) LESS BONUS - 300,000 X 10% - - -
BALANCE -
 2) LESS DISTRIBUTION - 270,000 X 50% - 270,000 X 50% - -
BALANCE - - - - -

9. SALARIES TO PARTNERS*, INTEREST ON PARTNERS CAPITAL* , BONUS TO MANAGING PARTNER CARLOTA *AND THE BALANCE ON AN AGREED RATIO 50:50

TOTAL DELA JOYA MARQUEZ TOTALS

ORIGINAL CAPITAL INVESTMENT 100,000.00 200,000.00 300,000.00

PROFIT -
1) LESS SALARIES - - - -
BALANCE -
2) LESS INTEREST - 100,000 X 10% - 200,000 X 20% - -
BALANCE -
3) LESS BONUS - 300,000 X 10% - - -
BALANCE -
4) LESS DISTRIBUTION - 160,000 X 50% - 160,000 X 50% - -
BALANCE - - - - -

* REFER TO GIVEN

JOURNAL ENTRIES:
DATE PATICULARS DR CR

1) INCOME AND EXPENSE SUMMARY

DELA JOYA,DRAWING
MARQUEZ, DRAWING
TO RECORD SALARIES OF PARTNERS

2) INCOME AND EXPENSE SUMMARY

DELA JOYA,DRAWING
MARQUEZ, DRAWING
TO RECORD INTEREST TO PARTNERS ORIGINAL CAPITAL CONTRIBUTION
3) INCOME AND EXPENSE SUMMARY
DELA JOYA,DRAWING
TO RECORD BONUS TO MANAGING PARTNER DELA JOYA

4) INCOME AND EXPENSE SUMMARY

DELA JOYA,DRAWING
MARQUEZ, DRAWING
TO DISTRIBUTE THE BALANCE OF PROFITS ACCORDING TO AGREED RATIO OF 50:50
PARTNERS' AGREEMENT

PROFIT 300,000.00
DELA JOYA MARQUEZ TOTAL
1. EQUALLY OR IN AN AGREED RATIO

EQUALLY 50:50 300,000 X 50% 150,000.00 300,000 X 50% 150,000.00 300,000.00

AGREED RATIO 60:40 300,000 X 60% 180,000.00 500,000 X 40% 120,000.00 300,000.00

DELA JOYA MARQUEZ TOTAL

2. ORIGINAL CAPITAL INVESTMENT* 100,000.00 200,000.00

100/300 1/3 300,000 X 1/3 100,000.00

200/300 2/3 300,000 X 2/3 200,000.00 300,000.00

DELA JOYA MARQUEZ TOTAL

3. CAPITAL AT THE BEG OF THE YEAR* 100,000.00 200,000.00 300,000.00

100/300 1/3 300,000 X 1/3 100,000.00

200/300 2/3 300,000 X 2/3 200,000.00 300,000.00

DELA JOYA MARQUEZ TOTAL

4. CAPITAL AT THE END OF THE YEAR* 75,000.00 150,000.00 225,000.00

75/225 1/3 300,000 X 1/3 100,000.00

 150/225 2/3 300,000 X 2/3 200,000.00 300,000.00

DELA JOYA MARQUEZ TOTAL

5. AVERAGE CAPITAL BALANCES* 50,000.00 100,000.00 150,000.00

50/150 1/3 300,000 X 1/3 100,000.00

100/150 2/3 300,000 X 2/3 200,000.00 300,000.00

6. INTEREST ON PARTNERS CAPITAL * ; BALANCE IN AN AGREED RATIO OF 50:50

TOTAL DELA JOYA MARQUEZ TOTAL

ORIGINAL CAPITAL INVESTMENT 100,000.00 200,000.00

PROFIT 300,000.00
1) LESS INTEREST 50,000.00 100,000.00 10% 10,000.00 200,000.00 20% 40,000.00 50,000.00
BALANCE 250,000.00
2) LESS DISTRIBUTION 250,000.00 250,000 X 50% 125,000.00 250,000 X 50% 125,000.00 250,000.00
BALANCE - 135,000.00 165,000.00 300,000.00 300,000.00

7. SALARIES TO PARTNERS *AND BALANCE ON AGREED RATIO 50:50

TOTAL DELA JOYA MARQUEZ TOTAL

PROFIT 300,000.00
1) LESS SALARIES 60,000.00 20,000.00 40,000.00 60,000.00
BALANCE 240,000.00
 2) LESS DISTRIBUTION 240,000.00 240,000 X 50% 120,000.00 240,000 X 50% 120,000.00 240,000.00
BALANCE - 140,000.00 160,000.00 300,000.00 300,000.00

8. BONUS TO MANAGING PARTNER CARLOTA* AND BALANCE ON AGREED RATIO 50:50

TOTAL DELA JOYA MARQUEZ TOTAL

PROFIT 300,000.00
1) LESS BONUS 30,000.00 300,000 X 10% 30,000.00 - 30,000.00
BALANCE 270,000.00
2) LESS DISTRIBUTION 270,000.00 270,000 X 50% 135,000.00 270,000 X 50% 135,000.00 270,000.00
BALANCE - 165,000.00 135,000.00 300,000.00 300,000.00

9. SALARIES TO PARTNERS*, INTEREST ON PARTNERS CAPITAL* , BONUS TO MANAGING PARTNER CARLOTA *AND THE BALANCE ON AN AGREED RATIO 50:50

TOTAL DELA JOYA MARQUEZ TOTALS

ORIGINAL CAPITAL INVESTMENT 100,000.00 200,000.00

PROFIT 300,000.00
1) LESS SALARIES 60,000.00 20,000.00 40,000.00 60,000.00
BALANCE 240,000.00
2) LESS INTEREST 50,000.00 100,000 X 10% 10,000.00 200,000 X 20% 40,000.00 50,000.00
BALANCE 190,000.00
3) LESS BONUS 30,000.00 300,000 X 10% 30,000.00 - 30,000.00
BALANCE 160,000.00
4) LESS DISTRIBUTION 160,000.00 160,000 X 50% 80,000.00 160,000 X 50% 80,000.00 160,000.00
BALANCE - 140,000.00 160,000.00 300,000.00 300,000.00

* REFER TO GIVEN
JOURNAL ENTRIES:
DATE PATICULARS DR CR

1) INCOME AND EXPENSE SUMMARY 6,000.00

DELA JOYA,DRAWING 20,000.00
MARQUEZ, DRAWING 40,000.00
TO RECORD SALARIES OF PARTNERS

2) INCOME AND EXPENSE SUMMARY 50,000.00

DELA JOYA,DRAWING 10,000.00
MARQUEZ, DRAWING 40,000.00
TO RECORD INTEREST TO PARTNERS ORIGINAL CAPITAL CONTRIBUTION

3) INCOME AND EXPENSE SUMMARY 30,000.00

DELA JOYA,DRAWING 30,000.00
TO RECORD BONUS TO MANAGING PARTNER DELA JOYA

4) INCOME AND EXPENSE SUMMARY 160,000.00

DELA JOYA,DRAWING 80,000.00
MARQUEZ, DRAWING 80,000.00
TO DISTRIBUTE THE BALANCE OF PROFITS ACCORDING TO AGREED RATIO OF 50:50