Question two $($Q$2)$:

K$.$ Williams and C$.$ Adams formed a partnership this year by making capital contributions of $$300,000,$ and $$200,000,$ respectively.

Per the partnership agreement, the partners will have salary allowances of $$102,000$ to Williams, $$162,000$ to Adams.

Also, the partneship agreement requires that profit will be shared on a ratio of $3$:$2$ after the allocation of salaries. They made a profit of $$390,000$

$02$ Required :

Use the schedule below to calculate how the profit of $$390,000$ would be distributed to the three partners.

Calculations

Williams

Adams

Total

Profit

Salary allowance $-$ Allocation:

Williams

Adams

Total Salaries Allocated

Balance of Profit

Balance of Profit allocated as per ratio

Balance of Profit After Allocation

Shares of partners