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    PArtnership Operations - Sanchez & Dominguez

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    Jasmine Acta
    1. Sam and Neneng contributed capital to form an investment partnership, with Sam contributing $2.4 million in cash and Neneng contributing $2.2 million in buildings and $1.4 million in equipment. 2. The partnership had $840,000 in net income for 2019. Various methods for allocating this income between Sam and Neneng based on their capital contributions or salaries are shown. 3. Under each method, journal entries are made to allocate the net income between Sam and Neneng's capital accounts to close out the income for the year.

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    PArtnership Operations - Sanchez & Dominguez

    Uploaded by

    Jasmine Acta
    18 views6 pages
    1. Sam and Neneng contributed capital to form an investment partnership, with Sam contributing $2.4 million in cash and Neneng contributing $2.2 million in buildings and $1.4 million in equipment. 2. The partnership had $840,000 in net income for 2019. Various methods for allocating this income between Sam and Neneng based on their capital contributions or salaries are shown. 3. Under each method, journal entries are made to allocate the net income between Sam and Neneng's capital accounts to close out the income for the year.

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    1. Sam and Neneng contributed capital to form an investment partnership, with Sam contributing $2.4 million in cash and Neneng contributing $2.2 million in buildings and $1.4 million in equipment. 2. The partnership had $840,000 in net income for 2019. Various methods for allocating this income between Sam and Neneng based on their capital contributions or salaries are shown. 3. Under each method, journal entries are made to allocate the net income between Sam and Neneng's capital accounts to close out the income for the year.

    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
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    Download as xlsx, pdf, or txt
    18 views6 pages

    PArtnership Operations - Sanchez & Dominguez

    Uploaded by

    Jasmine Acta
    1. Sam and Neneng contributed capital to form an investment partnership, with Sam contributing $2.4 million in cash and Neneng contributing $2.2 million in buildings and $1.4 million in equipment. 2. The partnership had $840,000 in net income for 2019. Various methods for allocating this income between Sam and Neneng based on their capital contributions or salaries are shown. 3. Under each method, journal entries are made to allocate the net income between Sam and Neneng's capital accounts to close out the income for the year.

    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
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    of 6

    1.

    Journal Entry to record the investment


    Cash 2,400,000.00
    Sanchez, Capital
    To record Sam's contribution

    Building 2,200,000.00
    Equipment 1,400,000.00
    Dominguez, Capital
    To reocrd Neneng's contribution

    Requirement 2
    A. 2019 Sanchez
    Divided Equally (840,000/2) ₱ 420,000.00

    Account Titles and Explanation Debit


    Income Summary 840,000.00
    Sanchez, Capital
    Dominguez, Capital
    To close the net income to capital accounts

    B. 2019 Sanchez
    Sanchez (2,400,000/6,000,000) * 840,000 336,000.00
    Dominguez (3,600,000 / 6,000,000) * 840,000
    Total Share in Profit ₱ 336,000.00

    Account Titles and Explanation Debit


    Income Summary 840,000.00
    Sanchez, Capital
    Dominguez, Capital
    To close the net income to capital accounts

    C. 2019 Sanchez
    Sanchez (2,400,000/6,000,000) * 840,000 336,000.00
    Dominguez (3,600,000 / 6,000,000) * 840,000
    Total Share in Profit ₱ 336,000.00

    Account Titles and Explanation Debit


    Income Summary 840,000.00
    Sanchez, Capital
    Dominguez, Capital
    To close the net income to capital accounts

    D. 2019 Sanchez
    Interest:
    Sanchez (2,400,000 * 10%) 240,000.00
    Dominguez (3,600,000 * 10%)
    Remainder: (240,000) 120,000.00
    Total Share in Profit ₱ 360,000.00

    Account Titles and Explanation Debit


    Income Summary 840,000.00
    Sanchez, Capital
    Dominguez, Capital
    To close the net income to capital accounts

    E. 2019 Sanchez
    Salaries:
    Sanchez 400,000.00
    Dominguez
    Remainder: 160,000 80,000.00
    Total Share in Profit ₱ 480,000.00

    Account Titles and Explanation Debit


    Income Summary 840,000.00
    Sanchez, Capital
    Dominguez, Capital
    To close the net income to capital accounts

    F 2019 Sanchez
    Salaries 400,000.00
    Interest:
    Sanchez (2,400,000 * 9%) 216,000.00
    Dominguez (3,600,000 * 9%)
    Remainder: (380,000) (190,000.00)
    Total Share in Profit ₱ 426,000.00

    Account Titles and Explanation Debit


    Income Summary 840,000.00
    Sanchez, Capital
    Dominguez, Capital
    To close the net income to capital accounts

    G 2019 Sanchez
    Salaries 400,000.00
    Interest:
    Sanchez (2,400,000 * 9%) 216,000.00
    Dominguez (3,600,000 * 9%)
    Remainder: (380,000) (190,000.00)
    Total Share in Profit ₱ 426,000.00

    Account Titles and Explanation Debit


    Income Summary 840,000.00
    Sanchez, Capital
    Dominguez, Capital
    To close the net income to capital accounts

    H 2019 Sanchez
    Salaries 400,000.00
    Interest:
    Sanchez (2,400,000 * 9%) 216,000.00
    Dominguez (3,600,000 * 9%)
    Remainder: (380,000) (190,000.00)
    Total Share in Profit ₱ 426,000.00

    Account Titles and Explanation Debit


    Income Summary 840,000.00
    Sanchez, Capital
    Dominguez, Capital
    To close the net income to capital accounts
    2,400,000.00

    3,600,000.00

    Dominguez TOTAL
    ₱ 420,000.00 ₱ 840,000.00

    Credit

    420,000.00
    420,000.00

    Dominguez TOTAL
    336,000.00
    504,000.00 504,000.00
    ₱ 504,000.00 ₱ 840,000.00

    Credit

    336,000.00
    504,000.00

    Dominguez TOTAL
    336,000.00
    504,000.00 504,000.00
    ₱ 504,000.00 ₱ 840,000.00

    Credit
    336,000.00
    504,000.00

    Dominguez TOTAL

    240,000.00
    360,000.00 360,000.00
    120,000.00 240,000.00
    ₱ 480,000.00 ₱ 840,000.00

    Credit

    360,000.00
    480,000.00

    Dominguez TOTAL

    400,000.00
    280,000.00 280,000.00
    80,000.00 160,000.00
    ₱ 360,000.00 ₱ 840,000.00

    Credit

    480,000.00
    360,000.00

    Dominguez TOTAL
    280,000.00 680,000.00

    216,000.00
    324,000.00 324,000.00
    (190,000.00) (380,000.00)
    ₱ 414,000.00 ₱ 840,000.00

    Credit

    426,000.00
    414,000.00

    Dominguez TOTAL
    280,000.00 680,000.00

    216,000.00
    324,000.00 324,000.00
    (190,000.00) (380,000.00)
    ₱ 414,000.00 ₱ 840,000.00

    Credit

    426,000.00
    414,000.00

    Dominguez TOTAL
    280,000.00 680,000.00

    216,000.00
    324,000.00 324,000.00
    (190,000.00) (380,000.00)
    ₱ 414,000.00 ₱ 840,000.00

    Credit

    426,000.00
    414,000.00

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