If the partnership experiences a net loss of $60,000 for the year, what will be the final net amount of profit or (loss) closed to each partner's capital account?

A) ($90,000) to Alfred and $30,000 to Barne
B) ($30,000) to Alfred and ($30,000) to Barne
C) ($24,000) to Alfred and ($36,000) to Barne
D) $30,000 to Alfred and ($90,000) to Barne

B) Alfred:
Interest allocation: $60,000
Salary allocation: $30,000

Barne:
Interest allocation: $90,000
Salary allocation: $60,000

There is a total of $240,000 for positive allocations. To bring them down to a $60,000 loss, a residual adjustment of ($300,000) is needed which is allocated ($120,000) to Alfred and ($180,000) to Barne. After these amounts are assigned to the partners, each partner's capital account will be reduced by a net $30,000.

Business

You might also like to view...

A large distribution center needed to fill 12 merchandise sorting positions. They advertised the openings in the local newspaper and received 90 applications. Out of the 90 applications, 35 applicants were qualified and interviewed for the position. What is the yield ratio for the newspaper recruiting?

a. 35% b. 39% c. 40% d. Not enough information to answer the question.

Business

Stories are quotes from experts in a given ?eld

Indicate whether this statement is true or false.

Business