Two recent business school graduates, Jane Johns and Lou Schwartz, started a shop called Exports Unlimited on

Question:

Two recent business school graduates, Jane Johns and Lou Schwartz, started a shop called Exports Unlimited on January 1. Their partnership agreement stipulated that each would receive 10 percent on capital contributed and that they would share equally any net income in excess of this 10 percent payment. Jane had contributed $50,000 and Lou, $70,000. They also agreed that Jane, who could devote only part time to the venture, would receive a salary of $ 15,000, while Lou would receive $40,000. Net income for the first year (after deducting both partners' salaries) was $66,000. What was each partner's total income (including salaries) from the business?
Partnership
A legal form of business operation between two or more individuals who share management and profits. A Written agreement between two or more individuals who join as partners to form and carry on a for-profit business. Among other things, it states...
Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For  book-img-for-question

Accounting Texts and Cases

ISBN: 978-1259097126

13th edition

Authors: Robert Anthony, David Hawkins, Kenneth Merchant

Question Posted: