Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. questions 1 through 5 are based upon the following

QUESTIONS 1 THROUGH 5 ARE BASED UPON THE FOLLOWING INFORMATION: X&Z Partnership was formed 10/1/20....

60.1K

Verified Solution

Question

Accounting

QUESTIONS 1 THROUGH 5 ARE BASED UPON THE FOLLOWING INFORMATION:

X&Z Partnership was formed 10/1/20. Xena was a sole proprietor prior to teaming with Zate, and so was Zate. Xena contributed equipment with a fair value of $20,000 and book value of $15,000 prior to the partnership formation, and Zate contributed $80,000 cash.

Net income for X&Z Partnership for 2020 is $200,000. Xena & Zate agreed to distribute income according to the following plan order:

Salary of $10,000 to Xena and $10,000 to Zate, then bonus to Xena of 10% income and 20% bonus to Zate of income, then 5% of original capital contribution balance for each partner, then residual income or loss to Xena & Zate respectively, 3:7 ratio.

1. What amount was recorded to Xena's capital account at the partnership formation?

2. What are the total bonuses allocated to the partners?

3. What amount of income was Zate allocated for percentage of original capital account at the partnership formation?

4. What is the amount of residual income (loss) allocated to Xena?

5. What is the total income allocation to Zate?

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students