Question
Dividing Partnership Net Income Required: Steve Jack and Chelsy Dane formed a partnership, dividing income as follows: Annual salary allowance to Dane of $115,050. Interest
Dividing Partnership Net Income
Required:
Steve Jack and Chelsy Dane formed a partnership, dividing income as follows:
- Annual salary allowance to Dane of $115,050.
- Interest of 5% on each partner's capital balance on January 1.
- Any remaining net income divided to Jack and Dane, 1:2.
Jack and Dane had $51,000 and $81,000, respectively, in their January 1 capital balances. Net income for the year was $195,000. How much is distributed to Jack and Dane?
Note: Compute partnership share.
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Sm Auditing Integrated Appr Review Copy
Authors: ARENS LO, EBBECKE
7th Edition
0135914396, 978-0135914397
