Cleary, Wasser, and Nolan formed a partnership on January 1, 2019, with investments of $100,000, $150,000, and $200,000, respectively. For division of income, they agreed to (1) interest of 10% of the beginning capital balance each year, (2) annual compensation of $10,000 to Wasser, and (3) sharing the remainder of the income or loss in a ratio of 20% for Cleary, and 40% each for Wasser and Nolan. Net income was $150,000 in 2019 and $180,000 in 2020. Each partner withdrew $1,000 for personal use every month during 2019 and 2020. What was the amount of interest attributed to Cleary for 2021? O $15,142 O $13,942 O $12,942 O $14,142 $10,000
Cleary, Wasser, and Nolan formed a partnership on January 1, 2019, with investments of $100,000, $150,000, and $200,000, respectively. For division of income, they agreed to (1) interest of 10% of the beginning capital balance each year, (2) annual compensation of $10,000 to Wasser, and (3) sharing the remainder of the income or loss in a ratio of 20% for Cleary, and 40% each for Wasser and Nolan. Net income was $150,000 in 2019 and $180,000 in 2020. Each partner withdrew $1,000 for personal use every month during 2019 and 2020. What was the amount of interest attributed to Cleary for 2021? O $15,142 O $13,942 O $12,942 O $14,142 $10,000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Transcribed Image Text:Cleary, Wasser, and Nolan formed a partnership on January 1, 2019, with investments of $100,000, $150,000, and $200,000, respectively. For division of income, they agreed to (1) interest of 10% of the beginning capital balance each year,
(2) annual compensation of $10,000 to Wasser, and (3) sharing the remainder of the income r loss in a ratio of 20% for Cleary, and 40% each for Wasser and Nolan. Net income was $150,000 in 2019 and $180,000 in 2020. Each partner
withdrew $1,000 for personal use every month during 2019 and 2020.
What was the amount of interest attributed to Cleary for 2021?
O $15,142
O $13,942
O $12,942
O $14,142
$10,000
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