Maurice Tutor

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    Argosy University/ Phoniex University/
    Nov-2005 - Oct-2011

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    Phoniex University
    Oct-2001 - Nov-2016

Category > Management Posted 02 Jun 2017 My Price 11.00

Donovan and Hansa

Landow, Donovan and Hansa who are forming a partnership to operate an antiques gallery, are discussing how income and losses should be distributed. Among the facts they are considering are the following:

a) Landow will contribute cash for operations of RM100,000, Donovan will contribute a collection of antiques that is valued at RM300,000 and Hansa will not contribute any assets.

b) Landow and Hansa will handle day-to-day business operations. Hansa will work full-time and Landow will devote about half-time to the partnership. Donovan will not devote time to day-to-day operations. A full-time clerk in retail store would make about RM20,000 in a year and a full time manager would receive about RM30,000.

c) The current interest rates on long-term loan is 8%

Landow, Donovan and Hansa have just hired you as the partnership’s accountant. Write a memorandum describing an equitable plan distributing income and losses. Outline the reasons why you believe this plan is equitable. According to your plan, which partner will gain the most if the partnership is very profitable, and which will lose the most if the partnership has large losses?

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Maurice Tutor
(5)
Status NEW Posted 02 Jun 2017 12:06 PM My Price 11.00

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