Question

note. The partnership paid $3,600 in interest that was the amount owed for the year and paid $9,900 for a two-year insurance policy on the first day of business. Compute net income for the first year for Tri Fecta.

Answer 1

Answer:

$177,150

Explanation:

Missing word "Tri Fecta, a partnership, had revenues of $376,000 in its first year of operations. The partnership has not collected on $45,500 of its sales and still owes $38,600 on $160,000 of merchandise it purchased. There was no inventory on hand at the end of the year. The partnership paid $30,300 in salaries. The partners invested $45,000 in the business and $27,000 was borrowed on a five-year note."

Particulars                              Amount

Sales revenue                        $376,00

Less: Cost of goods sold       $160,000

Gross profit                             $216,000

Less: Salaries expenses        $30,300

Less: Interest expenses         $3,600

Less: Insurance policies         $4,950    ($9,900/2)

Net Income                             $177,150

So, the net income for the first year for Tri Fecta. is $177,150