Max and Harry are in partnership. Profits for the year to 31 October 2019 are 120,000....

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Max and Harry are in partnership. Profits for the year to 31 October 2019 are 120,000. Max and Harry have agreed to share profits 60:40, but this is after paying a salary of 7,000 p.a. to Max because he works longer hours. Interest on capital of 3,000 p.a. is paid to Max and 5,000 p.a. is paid to Harry. During the year Max drew 50,000 and Harry drew 48,000 on account of their profit shares. Partner's drawings are shown as a reduction in their capital account and will be reflected on the partnership balance sheet. Show how the 120,000 profit for the year would be allocated between Max and Harry. Max and Harry are in partnership. Profits for the year to 31 October 2019 are 120,000. Max and Harry have agreed to share profits 60:40, but this is after paying a salary of 7,000 p.a. to Max because he works longer hours. Interest on capital of 3,000 p.a. is paid to Max and 5,000 p.a. is paid to Harry. During the year Max drew 50,000 and Harry drew 48,000 on account of their profit shares. Partner's drawings are shown as a reduction in their capital account and will be reflected on the partnership balance sheet. Show how the 120,000 profit for the year would be allocated between Max and Harry.