DividingPartnershipIncome

Tyler Hawes and Piper Albright formed a partnership, investing $210,000 and $70,000, respectively.

Determine their participation in the year's net income of $275,000 under each of the following independent assumptions:

1. No agreement concerning division of net income.
2. Divided in the ratio of original capital investment.
3. Interest at the rate of 6% allowed on original investments and the remainder divided in the ratio of 2:3.
4. Salary allowances of $40,000 and $45,000, respectively, and the balance divided equally.
5. Allowance of interest at the rate of 6% on original investments, salary allowances of $40,000 and $45,000, respectively, and the remainder divided equally.

Hawes

1.

2.

3.

4.

5.

Albright

1.

2.

3.

4.

5.