Kramer and Knox began a partnership by investing $70,000 and $76,000, respectively. The partners agreed to share net income and loss by granting annual salary allowances of $51,500 to Kramer and $41,500 to Knox, 12% interest allowances on their investments, and any remaining balance shared equally.

1.

Determine the partners shares of Kramer and Knox given a first-year net income of $89,800.

Kramer Knox

net income-89800

salary allowances

balance of income(loss)

interest allowances

balance of income(loss)

balance allocated equally

balance of income(loss)

shares of the partners

2.	Determine the partners shares of Kramer and Knox given a first-year net loss of $10,700 Kramer Knox net income(loss)-10700 salary allowances balance of incomes(loss) interest allowances balance of income(loss) balance allocated equally balance of income(loss) shares of the partners