Question

1. Dividing Partnership Income

   Tyler Hawes and Piper Albright formed a partnership, investing $116,000 and $174,000, respectively.

   Determine their participation in the year's net income of $280,000 under each of the following independent assumptions:

   1. No agreement concerning division of net income.
   2. Divided in the ratio of original capital investment.
   3. Interest at the rate of 6% allowed on original investments and the remainder divided in the ratio of 2:3.
   4. Salary allowances of $40,000 and $46,000, respectively, and the balance divided equally.
   5. Allowance of interest at the rate of 6% on original investments, salary allowances of $40,000 and $46,000, respectively, and the remainder divided equally.

   	Hawes	Albright
   (a)	$	$
   (b)	$	$
   (c)	$	$
   (d)	$	$
   (e)	$	$

Answer 1

B3 A B C D E | ovou AwN (a) (b) (c) (d) (e) Hawes $ 140,000 $ 112,000 $ 112,000 $ 137,000 $ 135,260 Albright $ 140,000 $ 168,000 $ 168,000 $ 143,000 $ 144,740

for formulas and calculations, refer to the image below -

А в D Hawes Albright (a) |=280000/2 = 280000/2 |(b) =280000* 116000/(116000+174000) = 280000*174000/(116000+174000) (c) =116000*6%+((280000-17400)*2/5) = 174000*6%+((280000-17400)*3/5) (d) -40000+((280000-86000)/2) =46000+((280000-86000)/2) (e) =(116000*6%)+40000+((280000-103400)/2) =(174000*6%)+46000+((280000-103400)/2)

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