The partnership agreement of Romeo and Rocky has the following provisions; the partners are to earn $10$ percent on the average capital. Romeo and Rocky are to earn salaries of $$25,000$ and $$10,000,$ respectively. And any remaining income or loss is to be divided between Romeo and Rocky using a $70$:$30$ ratio.

Romeo's average capital is $$500,000$ and Rockys' is $$300,000.$



Required:

What is Romeo's Allocated portion of Net Income $($Assuming Net Income is $$225,000)$

Answer rating: 100% (QA)

To calculate Romeos allocated portion of the net income we need to follow the provisions of the part... View the full answer