Entries for Allocation of Net Income

John Clark and David House decided to form a partnership on July $1,20-6.$ Clark invested $$54,000$ and House invested $$36,000.$ For the fiscal year ended June $30,20-7,$ a net

income of $$80,000$ was earned. Determine the amount of net income that Clark and House would receive under each of the following independent assumptions:

Clark House Total

There is no agreement concerning the distribution of net income.

Each partner is to receive $10\%$ interest on their original investment. The remaining net income is to be divided equally.

Clark and House are to receive a salary allowance of $$24,900$ and $$30,600,$ respectively. The remaining net income is to be divided equally.

Each partner is to receive $10\%$ interest on their original investment. Clark and House are to receive a salary allowance of $$24,900$ and $$30,600,$

respectively. The remaining net income is to be divided as follows: Clark, $30\%$ and House, $70\%.$