Kate DeLeo and Joe Desmond decided to form a partnership on January 1. Deleo invested $50,000...
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Kate DeLeo and Joe Desmond decided to form a partnership on January 1. Deleo invested $50,000 and Desmond invested $30,000. On Dec. 31, the end of the fiscal year, a net income of $100,000 was earned. Required: Determine the amount of net income that DeLeo and Desmond would receive under each of the following independent assumptions: a. There is no agreement concerning the distribution of net income. b. Each partner is to receive 10% on their original investment, and the remainder divided equally. с. Deleo and Desmond are to receive a salary allowance of $35,000 and $45,000 respectively, and the remainder divided equally. Each partner is to receive 10% on their original investment, DeLeo and Desmond are to receive a salary allowance of $30,000 and $40,000 respectively, and the remainder divided as follows: 60% to DeLeo and 40% to Desmond. d. Kate DeLeo and Joe Desmond decided to form a partnership on January 1. Deleo invested $50,000 and Desmond invested $30,000. On Dec. 31, the end of the fiscal year, a net income of $100,000 was earned. Required: Determine the amount of net income that DeLeo and Desmond would receive under each of the following independent assumptions: a. There is no agreement concerning the distribution of net income. b. Each partner is to receive 10% on their original investment, and the remainder divided equally. с. Deleo and Desmond are to receive a salary allowance of $35,000 and $45,000 respectively, and the remainder divided equally. Each partner is to receive 10% on their original investment, DeLeo and Desmond are to receive a salary allowance of $30,000 and $40,000 respectively, and the remainder divided as follows: 60% to DeLeo and 40% to Desmond. d.
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a Since there is no agreement concerning the distribution of the net income then both of them that i... View the full answer
Related Book For
Advanced Financial Accounting
ISBN: 978-0078025624
10th edition
Authors: Theodore E. Christensen, David M. Cottrell, Richard E. Baker
Posted Date:
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