Problem III $-$ DISTRIBUTION OF NET INCOME O NET LOSS

Ramer and Knox began a partnership investing $$60,000$ and $$90,000,$ respectively. During the first year, the partnership earned $$160,000.$

Instructions: Present the calculation showing how the $$160,000$ income is allocated under each of the separate plan for sharing income and loss.

The partners did not agree on a plan and therefore share income equally.

The partners agreed to share income and loss in proportion to their initial investments.

The partners agreed to share income by giving $$50,000$ per year salary allowance to Ramer, a $$40,000$ per year salary allowance fot Knox, $10\%$ interest on their initial capital investments, and the remaining balance shared equally.

Problem Solution III

$\backslash$table$[[,$Ramer,Knor$],[1.$ Share income equally,,$],[$Calculation: $$160,\frac{000}{2}=$$$80,000,,]]$

$\backslash$table$[[,$Ramer,Knor$],[2.$ Share income in proportion to their initial investment,,$],[$Calculation:$,,]]$

$\backslash$table$[[,$Ramer,Knor$],[1.$ Salary Allowance,,$],[2.10\%$ on their initial capital investment,,$],[3.$ Remaining equally,,$],[$Total Income Distribution,,$],[$Calculation:$,,],[$Remaining:$,,]]$