Gale Haley and Leah Manos formed a partnership, investing $180,000 and $60,000 respectively. Determine their participation in
Question:
Gale Haley and Leah Manos formed a partnership, investing $180,000 and $60,000 respectively.
Determine their participation in the year's net income of $150,000 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 10% allowed on original investments and the remainder divided in the ratio of 2:3;
(d) Salary allowances of $45,000 and $60,000 respectively, and the balance divided equally; (e) Allowance of interest at the rate of 10% on original investments, salary allowances of $45,000 and $60,000 respectively, and the remainder divided equally.
Step by Step Answer:
Accounting
ISBN: 978-0324401844
22nd Edition
Authors: Carl S. Warren, James M. Reeve, Jonathan E. Duchac