A) Realized Profit : 240,000 Adam and Andy

1) Each partner is allowed 10% interest on ending capital and remaining is divided equally

Adam Andy Total

10% x 630,000 63,000.00 63,000.00

10% x 360,000 36,000.00 36,000.00

99,000.00

141,000.0
Remainder 70,500.00 70,500.00 0

106,500.0 240,000.0
  133,500.00 0 0
Andy, the managing partner, is allowed a salaries of P150,000 and
2) the remainder divided in 4:1 ratio

Adam Andy Total

Salaries 150,000.00 150,000.00

      -

150,000.00

Remainder 72,000.00 18,000.00 90,000.00

  72,000.00 168,000.00 240,000.00

 Realized Profit :
3) Andy, the managing partner, is allowed a bonus of 20% of profit and 25% income tax: 240,000

a. Bonus is before bonus and income tax; remainder equally divided

Adam Andy Total

20% x
Bonus 240,000 48,000.00 48,000.00

Remainder 96,000.00 96,000.00 192,000.00

    96,000.00 144,000.00 240,000.00

b. Bonus is after deduction of bonus but before income tax; I=Realized Profit/Income
remainder
equally B=Bonus
T=Tax
Adam Andy Total 240,000.00
Bonus 40,000.00 40,000.00 B=20%( I-B) 120%B= 48,000 40,000.00
Remainder 100,000.00 100,000.00 200,000.00 B=20% I-20%B B=40,000 200,000.00
    100,000.00 140,000.00 240,000.00 120%B=20%I 50,000.00
240,000.00 120%B=20% (240,000) 150,000.00

c. Bonus is before deduction of bonus but after income tax; remainder equally

Bonus Adam Andy Total

95%B=15%(240,000
37,894.74 37,894.74 B= 20% ( I-T) )
Remaind
er 101,052.63 101,052.63 202,105.26 B= 20% (I- (25%( I-B)) 95%B= 36,000
     101,052.63 138,947.37 240,000.00 B=20% (I- 25% I+25%B) B= 37,894.74

B=20%I-5%I+5%B

B=15%I + 5%B

95%B= 15%I

240,000.0 240,000.0
0 I 0 I

37,894.74 B 50,526.32 T

202,105.2 189,473.6
6 9

50,526.32 T 20%

151,578.9
5 NI 37,894.74 B