Mavis and Roxanne Are Partners Who Share Profits and Losses

question 66

Essay

Mavis and Roxanne are partners who share profits and losses equally. The partnership agreement provides that Mavis will be paid an annual salary of $54,000 and Roxanne will be paid an annual salary of $36,000. The salaries were paid to the partners during 2013 and were charged to the partners' drawing accounts. The Income Summary account has a debit balance of $10,000 after revenue and expense accounts are closed at the end of the year.
1. What amount of net income or loss will be allocated to Mavis?
2. What amount of net income or loss will be allocated to Roxanne?

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Definitions:

Supine Position

Lying on the back with the face or front of the body upward.

Stroke Volume

The amount of blood ejected by the left ventricle of the heart in one contraction, an important parameter in assessing cardiac health.

Elasticity

The ability of a material or tissue to resume its normal shape after being stretched or compressed.

Diastole

The phase of the heart cycle during which the heart relaxes and fills with blood following contraction.