Angel Investor Associates Statement of Partnership Equity For the year ended December 31,2015 Particulars Dennis Overton Been Testerman Randy Campbell Total Balances, January 1,20Y5 180,000 120,000 300,000 Admission of Randy Campbell 75,000 75,000 Salary Allowance 40,000 40,000 Remaining income 52,800 35,200 22,000 110,000 Partner Withdrawals (46,400) (17,600) (11,000) (75,000) Balance,December 31,2015 $226,400 $137,600 $86,000 $450,000 Working Note 1: Net income after salary = 150,000 - 40,000 = $110,000 It is to be distributed in the capital ratio, as follows: Income of Dennis = 110,000 * (180/375) = $52,800 Income of Ben = 110,000 * (120/375) = $35,200 Income of Randy = 110,000 * (75/375) = $22,000 Working Note 2 Amount withdrawn by each of them are half of the total income earned. Withdrawn by Dennis = (52,800 + 40,000) 2 = $46,400 Withdrawn by Ben = 35,200 2 = $17,600 Withdrawn by Randy = 220,000 2 = $11,000

I am stuck on where the 150000-40000 and the 110000 come from?