a. No agreement concerning division of net income. b. Divided in the ratio of original capital investment. c. Interest at the rate of 6% allowed on original investments and the remainder divided in the ratio of 2:3. d. Salary allowances of $38,000 and $47,000, respectively, and the balance divided equally. e. Allowance of interest at the rate of 6% on original investments, salary allowances of $38,000 and $47,000, respectively, and the remainder divided equally.
a. No agreement concerning division of net income. b. Divided in the ratio of original capital investment. c. Interest at the rate of 6% allowed on original investments and the remainder divided in the ratio of 2:3. d. Salary allowances of $38,000 and $47,000, respectively, and the balance divided equally. e. Allowance of interest at the rate of 6% on original investments, salary allowances of $38,000 and $47,000, respectively, and the remainder divided equally.
College Accounting, Chapters 1-27
23rd Edition
ISBN:9781337794756
Author:HEINTZ, James A.
Publisher:HEINTZ, James A.
Chapter19: Accounting For Partnerships
Section: Chapter Questions
Problem 2SEB
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![Dividing Partnership Income
Beau Dawson and Willow McDonald formed a partnership, investing $180,000 and $60,000, respectively.
Determine their participation in the year's net income of $290,000 under each of the following independent assumptions:
a. No agreement concerning division of net income.
b. Divided in the ratio of original capital investment.
c. Interest at the rate of 6% allowed on original investments and the remainder divided in the ratio of 2:3.
d. Salary allowances of $38,000 and $47,000, respectively, and the balance divided equally.
e. Allowance of interest at the rate of 6% on original investments, salary allowances of $38,000 and $47,000, respectively, and the
remainder divided equally.
Dawson
a.
b.
C.
d.
e.
McDonald](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fcdcd994e-fa21-4c76-8234-cad321511623%2Fb4867b4c-3f2b-45a9-b749-1f729e345892%2Fldfwbo_processed.png&w=3840&q=75)
Transcribed Image Text:Dividing Partnership Income
Beau Dawson and Willow McDonald formed a partnership, investing $180,000 and $60,000, respectively.
Determine their participation in the year's net income of $290,000 under each of the following independent assumptions:
a. No agreement concerning division of net income.
b. Divided in the ratio of original capital investment.
c. Interest at the rate of 6% allowed on original investments and the remainder divided in the ratio of 2:3.
d. Salary allowances of $38,000 and $47,000, respectively, and the balance divided equally.
e. Allowance of interest at the rate of 6% on original investments, salary allowances of $38,000 and $47,000, respectively, and the
remainder divided equally.
Dawson
a.
b.
C.
d.
e.
McDonald
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