REQUIREMENTS:

1. Prepare the Profit Distribution Schedule, Income Statement , Statement of Changes in Partners' Equity and the Statement o
2. Make a horizontal analysis on the Income Statement and the Statement of Financial Position

Profit is divided according to the following agreements:

1. Allow interest of 5% on the beginning capital balances
2. Allow salaries of P300,000 for Ren and P200,000 for Shino
3. Allow a bonus of 10% of profit after tax
4. The remainder to be divided in 2:3 ratio

All figures below are in thousands of Pe

2021
debit credit
Accrued Liabilities 400
Accumulated Depreciation - Building 6,800
Accumulated Depreciation - Equipment 1,100
Accumulated Depreciation - Land Improvements 674
Administrative Expenses 4,892
Advances to employees 9
Allowance for doubtful accounts 303
Building 9,500
Cash in Banks 2,735
Cash on Hand 230
Cost of Sales 14,325
Current Claims Receivable 44
Equipment 7,704
Income Tax Payable 117
Income Taxes Expense 368
Insurance and other prepayments 86
Intangible Assets 701
Interest Expense 24
Interest Payable 116
Inventories 1,397
Investment Properties 1,477
Land 400
Land Improvements 2,868
Long-term Receivables from Partners 125
Net Sales 22,608
Notes Payable - Long-term 3,780
Novelty Items Inventories 56
Other current assets 156
Other Current Liabilities 193
Other income 618
Other Noncurrent Assets 1,515
Other current receivables 1,146
Other Noncurrent Liabilities 1,184
Prepaid Expenses 160
Ren, Withdrawals 588
Ren, Capital 5,180
Royalties and other revenues 2,864
Selling Expenses 5,646
Shino, Capital 7,252
Shino, Withdrawals 876
Short-term Debt 3,309
Short-term bank deposits 824
Trade Accounts Receivable 3,983
Trade Payables 5,022
Unearned Revenue 387
Unused office supplies 72
61,907 61,907

-
rs' Equity and the Statement of Financial Position

below are in thousands of Pesos

2020
debit credit
350
6,250
1,000
525
4,654
8
263
9,500
3,534
115
13,564
34
7,540
113
915
87
750
30
93
1,521
1,678
400
3,056
125
22,890
3,800
53
154
156
409
1,515
519
 1,184
151
615
4,973
2,618
4,613
5,500
500
3,111
633
2,854
5,720
217
54
59,172 59,172

-
 REN AND SHINO PARTNERSHIP
TRIAL BALANCE FOR THE ENDED DEC. 31, 2020 AND DEC.31, 2021
DEC.31, 2021 DEC.31, 2020
ACCOUNT TITLES DEBIT CREDIT DEBIT
Cash on Hand 230,000.00 115,000.00
Cash in Banks 2,735,000.00 3,534,000.00
Short-term bank deposits 824,000.00 633,000.00
Trade Accounts Receivable 3,983,000.00 2,854,000.00
Current Claims Receivable 44,000.00 34,000.00
Other current receivables 1,146,000.00 519,000.00
Allowance for doubtful accounts - 303,000.00
Advances to employees 9,000.00 8,000.00
Inventories 1,397,000.00 1,521,000.00
Novelty Items Inventories 56,000.00 53,000.00
Unused office supplies 72,000.00 54,000.00
Insurance and other prepayments 86,000.00 87,000.00
Other current assets 156,000.00 154,000.00
Intangible Assets 701,000.00 750,000.00
Investment Properties 1,477,000.00 1,678,000.00
Long-term Receivables from Partners 125,000.00 125,000.00
Building 9,500,000.00 9,500,000.00
Accumulated Depreciation - Building - 6,800,000.00
Equipment 7,704,000.00 7,540,000.00
Accumulated Depreciation - Equipment - 1,100,000.00
Land 400,000.00 400,000.00
Land Improvements 2,868,000.00 3,056,000.00
Accumulated Depreciation - Land Improvements - 674,000.00
Other Noncurrent Assets 1,515,000.00 1,515,000.00
Trade Payables 5,022,000.00
Accrued Liabilities 400,000.00
Income Tax Payable 117,000.00
Interest Payable 116,000.00
Unearned Revenue 387,000.00
Short-term Debt 3,309,000.00
Other Current Liabilities 193,000.00
Notes Payable - Long-term 3,780,000.00
Other Noncurrent Liabilities 1,184,000.00
Ren, Capital 5,180,000.00
Shino, Capital 7,252,000.00
Ren, Withdrawals 588,000.00 615,000.00
Shino, Withdrawals 876,000.00 500,000.00
Royalties and other revenues 2,864,000.00
Other income 618,000.00
Net Sales 22,608,000.00
Cost of Sales 14,325,000.00 13,564,000.00
Selling Expenses 5,646,000.00 4,613,000.00
Prepaid Expenses 160,000.00 151,000.00
Administrative Expenses 4,892,000.00 4,654,000.00
Income Taxes Expense 368,000.00 915,000.00
Interest Expense 24,000.00 30,000.00
TOTAL 61,907,000 61,907,000 59,172,000
DEC.31, 2020
CREDIT

263,000.00

6,250,000.00

1,000,000.00

525,000.00

5,720,000.00
350,000.00
113,000.00
93,000.00
217,000.00
3,111,000.00
156,000.00
3,800,000.00
1,184,000.00
4,973,000.00
5,500,000.00

2,618,000.00
409,000.00
22,890,000.00
59,172,000
 REN AND SHINO PARTNERSHIP
INCOME STATEMENT
DEC. 31, 2020

NET SALES 22,890,000.00

COST OF SALES 13,564,000.00
OPERATING INCOME 9,326,000.00
ROYALTIES AND OTHER INCOME 2,618,000.00
OTHER INCOME 409,000.00
GROSS PROFIT 12,353,000.00
LESS: GENERAL EXPENSES
SELLING EXPENSES 4,613,000.00
PREPAID EXPENSES 151,000.00
ADMIN.EXPENSES 4,654,000.00
INTEREST EXPENSE 30,000.00 9,448,000.00
INCOME BEFORE TAX 2,905,000.00
INCOME TAX EXPENSE 915,000.00
NET INCOME AFTER TAX 1,990,000.00
 REN AND SHINO PARTNERSHIP REN AND SHINO PARTNERSHIP
INCOME STATEMENT HORIZONTAL ANALYSIS
DEC. 31, 2021 INCREASE OR (DECREASE)
IN AMOUNT
NET SALES 22,608,000.00 (282,000.00)
COST OF SALES 14,325,000.00 761,000.00
OPERATING INCOME 8,283,000.00 (1,043,000.00)
ROYALTIES AND OTHER INCOME 2,864,000.00 246,000.00
OTHER INCOME 618,000.00 209,000.00
GROSS PROFIT 11,765,000.00 (588,000.00)
LESS: GENERAL EXPENSES
SELLING EXPENSES 5,646,000.00
PREPAID EXPENSES 160,000.00
ADMIN.EXPENSES 4,892,000.00
INTEREST EXPENSE 24,000.00 10,722,000.00 1,274,000.00
INCOME BEFORE TAX 1,043,000.00 (1,862,000.00)
INCOME TAX EXPENSE 368,000.00
NET INCOME AFTER TAX 675,000.00 (1,315,000.00)
D SHINO PARTNERSHIP
IZONTAL ANALYSIS
EASE OR (DECREASE)
IN PERCENTAGE
- 1.23
5.61
- 11.18
9.40
51.10
- 4.76

13.48
- 64.10

- 66.08
 REN AND SHINO PARTNERSHIP
PROFIT DISTRIBUTION SCHEDULE
DEC.31, 2020
NET INCOME: 1,990,000
REN
1. Allow interest of 5% on the beginning capital balances
(4,973,000 X 5%) 248,650.00
(5,500,000 X 5%)
2. Allow salaries of P300,000 for Ren and P200,000 for Shino 300,000.00
3. Allow a bonus of 10% of profit after tax
(1990,000 X 10%)= 199,000
(4,973,000 + 5,500,000= 10,473,000
(4,973,000/10,473,000 = 47% X 199,000) 93,530.00
(5,500,000/10,473,000 =53% X 199,000)
4. The remainder to be divided in 2:3 ratio
(2/5 X 767,350) 306,940.00
(3/5 X 767,350)
949,120.00
 RSHIP
HEDULE

SHINO TOTAL

248,650.00
275,000.00 275,000.00
200,000.00 500,000.00

93,530.00
105,470.00 105,470.00

306,940.00
460,410.00 460,410.00
1,040,880.00 1,990,000.00
 REN AND SHINO PARTNERSHIP
PROFIT DISTRIBUTION SCHEDULE
DEC.31, 2021

NET INCOME: 675,000 REN

1. Allow interest of 5% on the beginning capital balances
(5,180,000 X 5%) 259,000.00
(7,252,000 X 5%)
2. Allow salaries of P300,000 for Ren and P200,000 for Shino 300,000.00
3. Allow a bonus of 10% of profit after tax
(675,000 X 10%)= 67,500
(5,180,000 + 7,252,000= 12,432,000)
(5,180,000/12,432,000= 42% X 67,500) 28,350.00
(7,252,000/12,432,000= 58% X 67,500)
4. The remainder to be divided in 2:3 ratio
(2/5 X 514,100) 205,640.00
(3/5 X 514,100)
381,710.00
 RSHIP
HEDULE

SHINO TOTAL

259,000.00
362,600.00 362,600.00
200,000.00 500,000.00

28,350.00
39,150.00 39,150.00

(205,640.00)
308,460.00 (308,460.00)
293,290.00 675,000.00
 REN AND SHINO PARTNERSHIP
STATEMENT OF CHANGES IN PARTNER'S EQUITY
DEC. 31, 2020

REN SHINO TOTAL

ORIGINAL INVENSTMENT 4,973,000.00 5,500,000.00 10,473,000.00
LESS: WITHDRAWALS (615,000.00) (500,000.00) (1,115,000.00)
BALANCES 4,358,000.00 5,000,000.00 9,358,000.00
NET INCOME 949,120.00 1,040,880.00 1,990,000.00
PARTNERS EQUITY DEC. 31, 2020 5,307,120.00 6,040,880.00 11,348,000.00
 REN AND SHINO PARTNERSHIP
STATEMENT OF CHANGES IN PARTNER'S EQUITY
DEC. 31, 2021

REN SHINO TOTAL

ORIGINAL INVENSTMENT 5,180,000.00 7,252,000.00 12,432,000.00
LESS: WITHDRAWALS (588,000.00) (876,000.00) (1,464,000.00)
BALANCES 4,592,000.00 6,376,000.00 10,968,000.00
NET INCOME 381,710.00 293,290.00 675,000.00
PARTNERS EQUITY DEC. 31, 2021 4,973,710.00 6,669,290.00 11,643,000.00
 REN AND SHINO PARTNERSHIP
STATEMENT OF FINANCIAL POSITION
DEC. 31, 2020

ASSESTS
CURRENT ASSEST:
Cash on Hand 115,000.00
Cash in Banks 3,534,000.00
Short-term bank deposits 633,000.00
Trade Accounts Receivable 2,854,000.00
Current Claims Receivable 34,000.00
Other current receivables 519,000.00
Allowance for doubtful accounts (263,000.00)
Advances to employees 8,000.00
Inventories 1,521,000.00
Novelty Items Inventories 53,000.00
Unused office supplies 54,000.00
Insurance and other prepayments 87,000.00
Other current assets 154,000.00
TOTAL CURRENT ASSETS 9,303,000.00
NON CURRENT ASSETS:
Intangible Assets 750,000.00
Investment Properties 1,678,000.00
Long-term Receivables from Partners 125,000.00
Building 9,500,000.00
Accumulated Depreciation - Building (6,250,000.00)
Equipment 7,540,000.00
Accumulated Depreciation - Equipment (1,000,000.00)
Land 400,000.00
Land Improvements 3,056,000.00
Accumulated Depreciation - Land Improvements (525,000.00)
Other Noncurrent Assets 1,515,000.00
TOTAL NON CURRENT ASSETS 16,789,000.00
TOTAL ASSETS 26,092,000.00

LIABILITIES AND PARNERSHIPS EQUITY

LIABILITIES
CURRENT LIABILITIES:
Trade Payables 5,720,000.00
Accrued Liabilities 350,000.00
Income Tax Payable 113,000.00
Interest Payable 93,000.00
Unearned Revenue 217,000.00
Short-term Debt 3,111,000.00
Other Current Liabilities 156,000.00
TOTAL CURRENT LIABILITIES 9,760,000.00
NON CURRENT LIABILITIES:
Notes Payable - Long-term 3,800,000.00
Other Noncurrent Liabilities 1,184,000.00
TOTAL NON CURRENT LIABILITIES 4,984,000.00
TOTAL LIABILITIES 14,744,000.00
PARTNERSHIPS EQUITY:
REN CAPITAL DEC.31, 2020 5,307,120.00
SHINO CAPITAL DEC.31, 2021 6,040,880.00
TOTAL PARTNERS CAPITAL 11,348,000.00
TOTAL LIABILITIES AND PARTNERS CAPITAL 26,092,000.00
 REN AND SHINO PARTNERSHIP
STATEMENT OF FINANCIAL POSITION
DEC. 31, 2021

ASSESTS
CURRENT ASSEST:
Cash on Hand 230,000.00
Cash in Banks 2,735,000.00
Short-term bank deposits 824,000.00
Trade Accounts Receivable 3,983,000.00
Current Claims Receivable 44,000.00
Other current receivables 1,146,000.00
Allowance for doubtful accounts (303,000.00)
Advances to employees 9,000.00
Inventories 1,397,000.00
Novelty Items Inventories 56,000.00
Unused office supplies 72,000.00
Insurance and other prepayments 86,000.00
Other current assets 156,000.00
TOTAL CURRENT ASSETS 10,435,000.00
NON CURRENT ASSETS:
Intangible Assets 701,000.00
Investment Properties 1,477,000.00
Long-term Receivables from Partners 125,000.00
Building 9,500,000.00
Accumulated Depreciation - Building (6,800,000.00)
Equipment 7,704,000.00
Accumulated Depreciation - Equipment (1,100,000.00)
Land 400,000.00
Land Improvements 2,868,000.00
Accumulated Depreciation - Land Improvements (674,000.00)
Other Noncurrent Assets 1,515,000.00
TOTAL NON CURRENT ASSETS 15,716,000.00
TOTAL ASSETS

LIABILITIES AND PARNERSHIPS EQUITY

LIABILITIES
CURRENT LIABILITIES:
Trade Payables 5,022,000.00
Accrued Liabilities 400,000.00
Income Tax Payable 117,000.00
Interest Payable 116,000.00
Unearned Revenue 387,000.00
Short-term Debt 3,309,000.00
Other Current Liabilities 193,000.00
TOTAL CURRENT LIABILITIES 9,544,000.00
NON CURRENT LIABILITIES:
Notes Payable - Long-term 3,780,000.00
Other Noncurrent Liabilities 1,184,000.00
TOTAL NON CURRENT LIABILITIES 4,964,000.00
TOTAL LIABILITIES 14,508,000.00
PARTNERSHIPS EQUITY:
REN CAPITAL DEC.31, 2020 4,973,710.00
SHINO CAPITAL DEC.31, 2021 6,669,290.00
TOTAL PARTNERS CAPITAL 11,643,000.00
TOTAL LIABILITIES AND PARTNERS CAPITAL
 REN AND SHINO PARTNERSHIP
HORIZONTAL ANALYSIS
INCREASE OR (DECREASE)
IN AMOUNT IN PERCENTAGE

ASSETS
CURRENT ASSETS 1,132,000.00 12.17
NON-CURRENT ASSETS (1,073,000.00) - 6.39
TOTAL ASSETS 59,000.00 5.78

LIABILITIES & PARTNES EQUITY

CURRENT LIABILITIES (216,000.00) - 6.39
NON CURRENT LIABILITI (20,000.00) - 0.40
TOTAL LIABILITIES (236,000.00) - 6.79
PARTNERS EQUITY
REN CAPITAL (333,410.00) - 6.28
SHINO CAPITAL 628,410.00 10.40
TOTAL PARTNERS EQUI 295,000.00 4.12

26,151,000.00
26,151,000.00