Bert and Ernie (Party Planners)

Bert and Ernie have a partnership and are equal partners running a business as party planners and event co-ordinators focusing on children's parties and events. They provide a complete service including arranging the food, decorations, entertainment and party goods. They also hired out some of their equipment when it was not being used in their own business.

The accounts of Bert and Ernie for the year ended 30 June 2022 are as follows:

Receipts $

Cash banked in respect of parties planned and hosted 321,000

This included $11,250 which was from parties completed last financial year. Functions which were completed in the current year but not yet paid total $7,800.

Hire of equipment 32,400

Interest on drawings ($340 for Bert and $170 for Ernie) 510

Interest received 1,350

Expenditure

Purchases 63,240

Staff salaries (this amount included $19,000 paid to Bert's cousin, Bob, who works part-time and gets paid $4,000 more than a non-related employee who works the same hours doing a similar job) 92,000

Staff superannuation 8,280

Provision for annual leave 7,080

Salaries for Bert and Ernie ($60,000 for Bert and $40,000 for Ernie) 100,000

Superannuation for Bert and Ernie ($5,400 for Bert and $3,600 for Ernie) 9,000

Interest on capital ($790 for Bert and $540 for Ernie) 1,330

Repair of a bouncy castle 890

Purchase of a bubble machine 640

Legal fees 2,500

Additional information

The legal fees arose as a result of Bert and Ernie consulting their lawyers and accountants to advise them if in future they should change their structure to a company.

Annual leave actually paid during the year was $3,400.

$1,020 of the superannuation for staff remained unpaid at 30 June 2022.

They are an SBE for tax purposes

Required:

Calculate the net income of the partnership

Determine the partnership distribution and calculate the taxable income and net tax payable by each partner.