Guenter and Firmin both of whom are CPAs, form a partnership with Guenter investing $100,00 and firm $800,000. They agree to share net income as follow Salary allowance of $80,000 to Guenther and $60,000 Firmin. Interest allowance at 15 percent of beginning capital accounts balances. Any partnership earning excess of the amount required to cover the interest and salary allowances to be divided 60 percent to Guenther and 40 percent to Firmin I need prepare the partnership net income for the first year of operation amounted to $240,000 before interest and salary allowance. Show how this $247,000 will be divided between the two partners three column. List on separate lines the amount of interest, salaries, and the residual amount divided.
Guenter and Firmin both of whom are CPAs, form a partnership with Guenter investing $100,00 and firm $800,000. They agree to share net income as follow Salary allowance of $80,000 to Guenther and $60,000 Firmin. Interest allowance at 15 percent of beginning capital accounts balances. Any partnership earning excess of the amount required to cover the interest and salary allowances to be divided 60 percent to Guenther and 40 percent to Firmin I need prepare the partnership net income for the first year of operation amounted to $240,000 before interest and salary allowance. Show how this $247,000 will be divided between the two partners three column. List on separate lines the amount of interest, salaries, and the residual amount divided.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Guenter and Firmin both of whom are CPAs, form a partnership with Guenter investing $100,00 and firm $800,000. They agree to share net income as follow
- Salary allowance of $80,000 to Guenther and $60,000 Firmin.
- Interest allowance at 15 percent of beginning capital accounts balances.
- Any partnership earning excess of the amount required to cover the interest and salary allowances to be divided 60 percent to Guenther and 40 percent to Firmin
I need prepare the partnership net income for the first year of operation amounted to $240,000 before interest and salary allowance. Show how this $247,000 will be divided between the two partners three column. List on separate lines the amount of interest, salaries, and the residual amount divided.
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