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Dividing Partnership Net Income Lia Chen and Martin Monroe formed a partnership, dividing income as follows: Annual salary allowance to Chen of $35,000. Interest of
Dividing Partnership Net Income
Lia Chen and Martin Monroe formed a partnership, dividing income as follows:
Annual salary allowance to Chen of $35,000.
Interest of 4% on each partners capital balance on January 1.
Any remaining net income divided to Chen and Monroe, 2:1.
Chen and Monroe had $90,000 and $140,000, respectively, in their January 1 capital balances. Net income for the year was $70,000.
Required:
How much net income should be distributed to Chen and Monroe? Chen: $ Monroe: $
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