tailieunhanh - Editorial Special Industries and Special Topics_12

Tham khảo tài liệu 'editorial special industries and special topics_12', tài chính - ngân hàng, kế toán - kiểm toán phục vụ nhu cầu học tập, nghiên cứu và làm việc hiệu quả | ACCOUNTING FOR PARTNERSHIP OPERATIONS 40 9 before deducting partners salaries partners salaries are treated as a means of dividing partnership income. 5 6 Dixon Hep worth and Paton on the other hand indicate that the interpretation of partners salaries should vary with the circumstances Where there are a substantial number of partners and salaries are allowed to only one or two members who are active in administration there is practical justification for treating such salaries as operating charges closely akin to the cost of services furnished by outsiders. This is especially defensible where the salaries are subject to negotiation from period to period and are in no way dependent upon the presence of net earnings. Where there are only two partners and both capital investments and contributions of services are substantially equal there is less need for salary adjustments if salaries are allowed in such a situation it would seem to be reasonable to interpret them as preliminary distributions of net income an income derived from a coordination of capital and personal efforts in a business venture. Between these two extremes there lies a range of less clear-cut cases . .6 iii Bonuses. Where a particular partner furnishes especially important services the device of a bonus usually expressed as a percentage of net income may be employed as a means of providing additional compensation. The principal question that arises in such cases is the interpretation of the bonus in relation to the final net amount to be distributed according to the regular income ratio as illustrated in the following example. Stark and Bruch share profits equally. Per the partnership agreement Bruch is to receive a bonus of 20 of the net income of the firm before allowing the bonus for special services to the firm. If in a particular year the credit balance of the expense and revenue account is 27 000 before allowing the bonus profits are divided as follows Stark Bruch Total Bonus 20 of 27 000