4

22. The APB partnership agreement specifies that partnership net income be allocated as follows:

	Partner A	Partner P	Partner B
Salary allowance	$30,000	$10,000	$40,000
Interest on avg. capital balances	10%	10%	10%
Remainder	40%	40%	20%

Average capital balances for the current year were $50,000 for A, $30,000 for P, and $20,000 for B.Assuming a current year net income of $50,000, what amount should be allocated to each partner?

	Partner A	Partner P	Partner B
A.	$20,000	$20,000	$10,000
B.	$16,000	$16,000	$8,000
C.	$19,000	($3,000)	$34,000
D.	$17,000	$ 0	$33,000

		Option A
		Option B
		Option C
		Option D