Erin and Kathy form a partnership with Erin contributing $700 and Kathy contributing $300. The partners have agreed that Erin will first receive a return of her $700 investment, then Kathy will receive her $300 contribution and any additional distributions will be made 70 percent to Erin and 30 percent to Kathy. Year 1 book income is $100. At the end of Year 1 partnership assets have a book value $1,100 (the original contributions increased by Year 1 income). 1 How much Year 1 income will be allocated to Erin and Kathy? Clearly explain your answer. Part 2: The facts are the same as in Part 1 except Year 1 produces a book loss of $100. At the end of Year 1, partnership assets have a book value of $900 (the original contributions reduced by Year 1 loss). 1 How much of the Year 1 loss will be allocated to Erin and Kathy? Clearly explain your