The partnership agreement of Alix, Gise, and Bosco provides for the following income ratio: (a) Alix, the managing partner, receives a salary allowance of $108900, (b) each partner receives 15% interest on average capital investment, and (c) remaining net income or loss is divided equally. The average capital investments for the year were: Alix $607000, Gise $1100000, and Bosco $1810000. If partnership net income is $54900O, the amount allocated to Alix should be O $91050. O $199950. O $175850.
The partnership agreement of Alix, Gise, and Bosco provides for the following income ratio: (a) Alix, the managing partner, receives a salary allowance of $108900, (b) each partner receives 15% interest on average capital investment, and (c) remaining net income or loss is divided equally. The average capital investments for the year were: Alix $607000, Gise $1100000, and Bosco $1810000. If partnership net income is $54900O, the amount allocated to Alix should be O $91050. O $199950. O $175850.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:The partnership agreement of Alix, Gise, and Bosco provides for the following income ratio: (a) Alix,
the managing partner, receives a salary allowance of $108900, (b) each partner receives 15% interest
on average capital investment, and (c) remaining net income or loss is divided equally. The average
capital investments for the year were: Alix $607000, Gise $1100000, and Bosco $1810000. If
partnership net income is $549000, the amount allocated to Alix should be
$91050.
$199950.
$175850.
O $170800.
Expert Solution
Step 1
Given that:
Salary Allowance to Alix = $108900
Interest on Capital = 15%
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