question archive Daisey Brodsky and Jim Leigh began a partnership on February 1, 2021, by investing $56,000 and $81,000, respectively
Daisey Brodsky and Jim Leigh began a partnership on February 1, 2021, by investing $56,000 and $81,000, respectively
Subject:AccountingPrice: Bought3
Daisey Brodsky and Jim Leigh began a partnership on February 1, 2021, by investing $56,000 and $81,000, respectively. They agree to share profit and losses by allocating yearly salary allowances of $52,000 to Daisey and $38,000 to Jim, an interest allowance of 6% on their investments, and to split the remainder 55:45. During the year, Daisey withdrew $27,000 and Jim withdrew $18,000. The partnership recorded a loss of $14,000 in its first fiscal year.
Prepare a schedule showing the division of the loss for the year. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)
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BRODSKY AND LEIGH |
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| D. Brodsky | J. Leigh | Total | |||||||
| Loss | $ | ||||||||
| Salary allowance | |||||||||
| D. Brodsky | $ | ||||||||
| J. Leigh | $ | ||||||||
| Total | |||||||||
| Deficiency remaining for allocation | |||||||||
| Interest allowance | |||||||||
| D. Brodsky | |||||||||
| J. Leigh | |||||||||
| Total | |||||||||
| Deficiency remaining for allocation | |||||||||
| Fixed ratio | |||||||||
| D. Brodsky | |||||||||
| J. Leigh | |||||||||
| Total | |||||||||
| Loss remaining for allocation | |||||||||
| Loss allocated to the partners | $ | $ | $ | ||||||
Prepare the journal entry to close the Income Summary account at the end of the year. (Credit account titles are automatically indented when the amount is entered. Do not indent manually.)
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Account Titles and Explanation |
Debit |
Credit |
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J. Leigh, CapitalJ. Leigh, DrawingsCashD. Brodsky, CapitalIncome Summary |
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J. Leigh, CapitalIncome SummaryCashJ. Leigh, DrawingsD. Brodsky, Capital |
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D. Brodsky, CapitalIncome SummaryJ. Leigh, CapitalCashJ. Leigh, Drawings |
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| (To close Income Summary.) |
