part 2 number 3Homework Answers
Answer:
Statement of Total income of Crespo and Smith
| Particulars | Crespo | Smith |
| Interest on capital(a) | $15,840 | $26,160 |
| Salary(b) | $32,000 | $46,000 |
| Income Share (c) | $8,400 | $19,600 |
| Total | $56,240 | $91,760 |
a) Calculation of interest on capital = Average capital * Interest rate
Crespo = $132,000*12%
= $15840/-
Smith = $218,000*12%
= $26,160/-
b) Salary
Crespo =$32,000/-
Smith = $46,000/-
c) income share
Total Income Crespo-smith ltd =$148,000
Less: Interest on Capital =$42,000
($15840+$26160)
Less: Salary =$78,000
($32,000+$46000)
Net Income $28,000
Crespo Share =$28000*30% =$8,400/-
Smith Sahre =$28,000*70% =$19,600/-
Statement of Total income of Crespo and Smith
| Particulars | Crespo | Smith |
| Interest on capital(a) | $15,840 | $26,160 |
| Salary(b) | $32,000 | $46,000 |
| Income Share (c) | $8,400 | $19,600 |
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