Farrell and Jimmy Enter into a Partnership Agreement on 1

question 39

Multiple Choice

Farrell and Jimmy enter into a partnership agreement on 1 May 2017.Farrell contributes $70,000 and Jimmy contributes $150,000 as their capital contributions.They decide to share profits and losses in the ratio of their respective capital account balances.The net profit for the year ended 31 December 2017 is $80,000.Which of the following is the correct journal entry to record the allocation of profit?

• A) \[\begin{array} { | l | l | l | }
• \hline \text { Farrell, capital } & 25,455 & \\
• \hline \text { Iimmy, captial } & 54,545 & \\
• \hline \text { Income summary } & & 80,000 \\
• \hline
• \end{array}\]
• B) \[\begin{array} { | c | c | c | }
• \hline \text { Farrell, captial } & 54,545 & \\
• \hline \text { Jimmy, capital } & & 54,545 \\
• \hline
• \end{array}\]
• C) \[\begin{array} { | c | l | l | }
• \hline \text { Income summary } & 80,000 & \\
• \hline \text { Farrell, capital } & & 25,455 \\
• \hline \text { Jimmy, captial } & & 54,545 \\
• \hline
• \end{array}\]
• D) \[\begin{array} { | c | c | c | }
• \hline \text { Income summary } & 29,090 & \\
• \hline \text { Farrell, capital } & 25,455 & \\
• \hline \text { Jimmy, capital } & & 54,545 \\
• \hline
• \end{array}\]

Grasp the concept of cognitive dissonance and identify situations that produce dissonance.

Identify the components and evolution of the theory of planned behavior.

Recognize the role of subjective norms, behavioral intention, and perceived behavioral control in shaping behavior according to the theory of planned behavior.

Understand effort justification and other dissonance-reducing strategies.

---

Definitions:

Proportionate Share

The part of earnings, assets, or investments attributable to an investor or entity in proportion to their ownership interest or stake in a venture.

Tenants in Common

A form of co-ownership where each tenant owns a separate and distinct share of the property, which can be sold or passed on independently.

Strategic Financial

Pertains to the managing of a corporation's finances with a long-term perspective, focusing on investment decisions, financial planning, and policies that affect the company's financial health and strategic goals.

Jointly Controlled Entity

An entity that is managed and operated under a joint control agreement by two or more parties.