C. Eastwood, A. North, and M. West are manufacturers' representatives in the architecture business. Their capital accounts in the ENW partnership for 20X1 were as follows: 9/1 C. Eastwood, Capital 8,900 1/1 5/1 31,300 6,900 3/1 A. North, Capital 9,900 1/1 7/1 9/1 42,000 6,200 4,300 8/1 M. West, Capital 13,900 1/1 4/1 6/1 50,400 8,200 3,600 Required: For each of the following independent income-sharing agreements, prepare an income distribution schedule. a. Salaries are $15,300 to Eastwood, $20,100 to North, and $18,400 to West. Eastwood receives a bonus of 5 percent of net income after deducting his bonus. Interest is 10 percent of ending capital balances. Eastwood, North, and West divide any remainder in a 3:3:4 ratio, respectively. Net income was $80,640. (Amounts that are to be deducted from an individual partner's capital balance should be entered with a minus sign.) a. Salaries are $15,300 to Eastwood, $20,100 to North, and $18,400 to West. Eastwood receives a bonus of 5 percent of net income after deducting his bonus. Interest is 10 percent of ending capital balances. Eastwood, North, and West divide any remainder in a 3:3:4 ratio, respectively. Net income was $80,640. (Amounts that are to be deducted from an individual partner's capital balance should be entered with a minus sign.) Eastwood North West Total Profit ratio 3 Ending capital Net income Salary Bonus Interest on ending capital balance Residual income (deficit) Allocate Total $ 0 $ 0 $ 0 $ b. Interest is 10 percent of weighted-average capital balances. Salaries are $25,100 to Eastwood, $21,700 to North, and $26,400 to West. North receives a bonus of 10 percent of net income after deducting the bonus and her salary. Any remainder is divided equally. Net income was $68,450. (Do not round intermediate calculations. Round the final answers to nearest whole dollar. Amounts that are to be deducted from an individual partner's capital balance should be entered with a minus sign.) Eastwood North West Total Profit ratio Average capital Net income Interest on average capital balance Salary Bonus Residual income (deficit) $ |0|0|000 Allocate Total $ 0 $ 0 $ 0 $ c. West receives a bonus of 20 percent of net income after deducting the bonus and the salaries. Salaries are $21,400 to Eastwood, $19,000 to North, and $15,700 to West. Interest is 10 percent of beginning capital balances. Eastwood, North, and West divide any remainder in an 8:7:5 ratio, respectively. Net income was $95,220. (Do not round intermediate calculations. Amounts that are to be deducted from an individual partner's capital balance should be entered with a minus sign.) Eastwood North West Total Profit ratio Beginning capital Net income Bonus Salary Interest on beginning capital balance Residual income (deficit) Allocate Total $ 0 % 0 % 0 % 0
