Dividing Partnership Net Income

Required:

Steve King and Chelsy Dane formed a partnership, dividing income as follows:

1. Annual salary allowance to King of $176,130.
2. Interest of 7% on each partner's capital balance on January 1.
3. Any remaining net income divided to King and Dane, 1:2.

King and Dane had $45,000 and $105,000, respectively, in their January 1 capital balances. Net income for the year was $309,000. How much is distributed to King and Dane?

Note: Compute partnership share. King: fill in the blank 1 Dane: fill in the blank 2

Dividing Partnership Income Tyler Hawes and Piper Albright formed a partnership, investing $70,000 and $210,000, respectively. Determine their participation in the year's net income of $108,000 under each of the following independent assumptions: a. No agreement concerning division of net income. b. Divided in the ratio of original capital investment. c. Interest at the rate of 5% allowed on original investments and the remainder divided in the ratio of 2:2. d. Salary allowances of $34,000 and $47,000, respectively, and the balance divided equally. e. Allowance of interest at the rate of 5% on original investments, salary allowances of $34,000 and $47,000, respectively, and the remainder divided equally. Hawes Albright (a) (b) (c) (d) (e) 00000