ABC's partnership provided for the following distribution of profits and losses;"First".

A to receive
10% of the net income up to P1,000,000 and 20% on the amount of excess thereof; "Second", B and C
each, are to receive 5% of the remaining income in excess of P1,500,000 after A's share as per above
and "The balance to be divided equally among the partners."
For the year just ended, the partnership realized a net income of P2,500,000 before distribution to
partners. The share of A is:
a. P1,300,000 c. P1,080,000
b. P1,000,000 d. P1,100,000

ANSWER
A B C Total
To A (P1,000,000 x 10%) P100,000
(1,500,000 x 20%) 300,000 P400,000
To B & C (2,500,000-400,000-
1,500,000=600,000 x 5% P30,000 P30,000 60,000
Balance, equally 680,000 680,000 680,000 2,040,000
Total P1,080,000 P710,000 P710,000 P2,500,000