Items 2 and 3 are based on the following information.

Bugs and Bunny entered into partnership on March 1, 20A, investing

Php500,000 and Php300,000, respectively. It was agreed that Bugs, the managing
partner, was to receive a salary of Php48,000 per year and Php6,244 bonus for the
period; the balance of the profit was to be divided in the ratio of their original
capital. On December 31, 20A, account balances are as follows:

Cash 280,000 Accounts payable 240,000

Accounts receivables 268,000 Sales 932,000
Furniture & Fixtures 180,000 Bugs, Capital 500,000
Purchases 784,000 Bunny, Capital 300,000
Sales returns & allowances 20,000 Bugs, Drawing 120,000
Operation expenses 242,200 Bunny, Drawing