Miguel and Smith have Capital balances on January 1st of $50,000 and $40,000 respectively. The partnership income sharing agreement provides for 1) annual salaries of $22,000 for Miguel and $13,000 for Smith

2) interest at 10% on beginning Capital balances and 3) remaining income or loss to be shared 60% by Miguel and 40% by Smith.

Your answer is partially correct. Try again. (1) Prepare a schedule showing the distribution of net income, assuming net income is $50,000 negative sign preceding the number or parenthesis, e.g. -15,000, (15,000).) DIVISION OF NET INCOME McGill Smyth Total Salary allowance 50000 40000 90000 Interest allowance 22000 13000 35000 Total salaries and interest 5000 4000 9000 l??360] 1 ??6000) Remaining income deficiency 2400 Total division of net income 80600 59400 140000 (2) Prepare a schedule showing the distribution of net income, assuming net income is $36,0 negative sign preceding the number or parenthesis, e.g. -15,000, (15,000).) DIVISION OF NET INCOME McGill Smyth Total