Answer: B. 137,500
Explanation: since there was no provision in their agreement on how profits are to be split,
The full profit after expenses will be split/shared equally for peace sake.
ie $275,000÷2 = $137,500
Also, following Subchapter S corporation; it requires that all the owners be treated the same way in terms of their shares of the firm’s operating profits, liquidation profits, and distributions of those profits.
Answer:
Responsibility center
Explanation:
A responsibility center is a unit in an organization that is headed by a manager or an executive, in which he has a level of responsibility and authority over the performance of that unit. The manager is usually held responsible for the outcomes and activities carried out in the unit. In an organization, there are several responsibility centers that tend to different responsibilities.
A responsibility center is a functional entity of its own that is staffed. Examples of responsibility centers are cost centers, profit centers, revenue centers and so on.
Answer:
a. Date Account Title and Explanation Debit Credit
Insurance Expenses $2,800
Prepaid Insurance $2,800
(To record 6-month Insurance coverage expired)
b. Date Account Title and Explanation Debit Credit
Supplies Expenses $10,200
Supplies $10,200
(8,200 +3,600 - 1,600)
(To record supplies consumed during the year)
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