Dividing partnership income Dahl and Westhoff have decided to form a partnership. They have agreed that Dahl is to invest $153,000 and that Westhoff is to invest $51,000. Dahl is to devote one-half time to the business, and Westhoff is to devote full time. The following plans for the division of income are being considered: a. Equal division. b. In the ratio of original investments. c. In the ratio of time devoted to the business. d. Interest of 6% on original investments and the remainder equally. e. Interest of 6% on original investments, salary allowances of $45,000 to Dahl and $80,000 to Westhoff, and the remainder equally. f. Plan (e), except that Westhoff is also to be allowed a bonus of $29,000 if net income exceeds $100,000. Required: For each plan, determine the division of the net income under each of the following assumptions: (1) net income of $178,000 and (2) net income of $245,000. Round answers to the nearest whole dollar. Plan a. b. C. d. e. f. (1) $178,000 Dahl $ $ (1) $178,000 Westhoff (2) $245,000 Dahl $ $ (2) $245,000 Westhoff $ $ $ $
Dividing partnership income Dahl and Westhoff have decided to form a partnership. They have agreed that Dahl is to invest $153,000 and that Westhoff is to invest $51,000. Dahl is to devote one-half time to the business, and Westhoff is to devote full time. The following plans for the division of income are being considered: a. Equal division. b. In the ratio of original investments. c. In the ratio of time devoted to the business. d. Interest of 6% on original investments and the remainder equally. e. Interest of 6% on original investments, salary allowances of $45,000 to Dahl and $80,000 to Westhoff, and the remainder equally. f. Plan (e), except that Westhoff is also to be allowed a bonus of $29,000 if net income exceeds $100,000. Required: For each plan, determine the division of the net income under each of the following assumptions: (1) net income of $178,000 and (2) net income of $245,000. Round answers to the nearest whole dollar. Plan a. b. C. d. e. f. (1) $178,000 Dahl $ $ (1) $178,000 Westhoff (2) $245,000 Dahl $ $ (2) $245,000 Westhoff $ $ $ $
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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![Dividing partnership income
Dahl and Westhoff have decided to form a partnership. They have agreed that Dahl is to invest $153,000 and that Westhoff is to invest $51,000.
Dahl is to devote one-half time to the business, and Westhoff is to devote full time. The following plans for the division of income are being
considered:
a. Equal division.
b. In the ratio of original investments.
c. In the ratio of time devoted to the business.
d. Interest of 6% on original investments and the remainder equally.
e. Interest of 6% on original investments, salary allowances of $45,000 to Dahl and $80,000 to Westhoff, and the remainder equally.
f. Plan (e), except that Westhoff is also to be allowed a bonus of $29,000 if net income exceeds $100,000.
Required:
For each plan, determine the division of the net income under each of the following assumptions: (1) net income of $178,000 and (2) net income of
$245,000. Round answers to the nearest whole dollar.
Plan
a.
b.
C.
d.
e.
f.
(1) $178,000
Dahl
$
$
$
$
$
(1) $178,000
Westhoff
(2) $245,000
Dahl
(2) $245,000
Westhoff
$](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F25952cc2-7fdd-4620-b2dc-0c6b8d9c3a72%2F48383680-cfcb-412d-baa1-88166766efba%2Frhy1ow_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Dividing partnership income
Dahl and Westhoff have decided to form a partnership. They have agreed that Dahl is to invest $153,000 and that Westhoff is to invest $51,000.
Dahl is to devote one-half time to the business, and Westhoff is to devote full time. The following plans for the division of income are being
considered:
a. Equal division.
b. In the ratio of original investments.
c. In the ratio of time devoted to the business.
d. Interest of 6% on original investments and the remainder equally.
e. Interest of 6% on original investments, salary allowances of $45,000 to Dahl and $80,000 to Westhoff, and the remainder equally.
f. Plan (e), except that Westhoff is also to be allowed a bonus of $29,000 if net income exceeds $100,000.
Required:
For each plan, determine the division of the net income under each of the following assumptions: (1) net income of $178,000 and (2) net income of
$245,000. Round answers to the nearest whole dollar.
Plan
a.
b.
C.
d.
e.
f.
(1) $178,000
Dahl
$
$
$
$
$
(1) $178,000
Westhoff
(2) $245,000
Dahl
(2) $245,000
Westhoff
$
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