Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

The partnership agreement of Alice, Baron & Crane was formed on January 2, 2017. The original cash investments were as follows: Alice $ 96,000 Baron

The partnership agreement of Alice, Baron & Crane was formed on January 2, 2017. The original cash investments were as follows:

Alice $ 96,000

Baron 144,000

Crane 216,000

According to the partnership contract, the partners were to be remunerated as follows:

  1. Salaries of $14,400 for Alice, $12,000 for Baron, and $13,600 for Crane.
  2. Interest at 12% on the average capital account balances during the year.
  3. Remainder divided 40% to Alice, 30% to Baron and 30% to Crane.

Income before partner withdrawals during the year ended December 31, 2017 was $92,080. During 2017 Alice invested additional capital of $24,000 in the partnership on July 1; Crane withdrew capital of $36,000 from the partnership on October 1. Each of the partners had monthly withdrawals of $1,250 against their shares of income for the year.

REQUIRED: Prepare a schedule showing the allocation of the partnership income to each partner.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

More Books

Students also viewed these Accounting questions

Question

Solve Prob. 1023 using the Sines-Zimmerli fatigue-failure criterion

Answered: 1 week ago

Question

Perform indicated operations and simplify. 2 x + 2 3-x x + 2x + X

Answered: 1 week ago