Louise and Thelma Are in Partnership Sharing Residual Profits and Losses

question 4

Multiple Choice

Louise and Thelma are in partnership sharing residual profits and losses 50:50. The profit for the year is $96 000. Thelma is entitled to a salary of $40 000 per annum (to be paid by means of a book entry) . The amount credited to Thelma's retained earnings account after the final distribution of profits is:

• A) $88 000
• B) $48 000
• C) $28 000
• D) $68 000

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