=+PR 12-2B Dividing partnership income obj. 2

✔ 1.

f. Larson net income, $41,600 570 Chapter 12 Accounting for Partnerships and Limited Liability Companies

e. Interest of 12% on original investments, salary allowances of $32,000 to Larson and

$64,000 to Alvarez, and the remainder equally.

f. Plan (e), except that Alvarez is also to be allowed a bonus equal to 20% of the amount by which net income exceeds the salary allowances.

Instructions For each plan, determine the division of the net income under each of the following assumptions: (1) net income of $105,000 and (2) net income of $180,000. Present the data in tabular form, using the following columnar headings:

$105,000 $180,000 Plan Larson Alvarez Larson Alvarez