ex 178 the adjusted trial balance of the ricci and napoli partnership for the year e 4325016

Ex. 178

The adjusted trial balance of the Ricci and Napoli Partnership for the year ended December 31, 2017, appears below:

RICCI AND NAPOLI PARTNERSHIP

Adjusted Trial Balance

December 31, 2017

   Debit Credit

Current Assets………………………………………19,000

Plant Assets………………………………………..80,000

Current Liabilities…………………………………….7,000

Long-term Debt………………………………………40,000

Ricci, Capital………………………………………..20,000

Ricci, Drawings………………………………………4,000

Napoli, Capital……………………………………..18,000

Napoli , Drawings…………………………………….7,000

Sales Revenue……………………………………….110,000

Cost of Goods Sold……………………………………62,000

Operating Expenses……………………………………  23,000     

195,000195,000

The partnership agreement stipulates that a division of partnership net income or net loss is to be made as follows:

1.A salary allowance of $12,000 to Ricci and $23,000 to Napoli.

2.The remainder is to be divided equally.

Instructions

(a)Prepare a schedule which shows the division of net income to each partner.

(b)Prepare the closing entries for the division of net income and for the drawings accounts at December 31, 2017.

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