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Adam, Bella, and Chris operate a partnership with a complex profit and loss sharing agreement. The average capital balance fo
1. Prepare a schedule to allocate income to the partners assuming that partnership net income for 2018 is $330,000. 2. Prepar
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Answer #1

1.

Adam Bella Chris Total
Bonus to Chris 30000 30000
Salary allocation 40000 50000 90000
Interest allocation 7200 [120000*6%] 16200 [270000*6%] 20400 [340000*6%] 43800
Residual allocation 33240 33240 99720 166200
Total 80440 99440 150120

Bonus = (330,000- Bonus) *10%

Bonus= 30,000

2.

Account Titles Debit Credit
Income summary 330000
Adam, Capital 80440
Bella, Capital 99440
Chris , Capital 150120
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