Reference no: EM132759300

Problem 1: In accordance with the Conceptual Framework, income includes both:

Select one:

a. gains and profits.

b. gains and losses.

c. revenue and gains.

d. returns and profits.

Problem 2: Hodges and Burton formed a partnership with capital of $30 000 and $45 000 respectively. The partnership agreement provides for the crediting of annual salaries of $45 000 to Hodges and $75 000 to Burton. Each partner is entitled to 20% interest on capital. The remaining profit or loss is divided equally. Assuming capital balances are adjusted to reflect profits and losses, how much, in total, will be credited to Burton's capital account if profit for the year is $198 000?

Select one:

a. $115 500

b. $ 85 500

c. $ 82 500

d. $ 52 500