Dividing Partnership Income Tyler Hawes and Piper Albright formed a partnership,
ID: 2544955 • Letter: D
Question
Dividing Partnership Income Tyler Hawes and Piper Albright formed a partnership, investing $331,200 and $220,800, respectively. Determine their participation in the year's net income of $282,000, under each of the following independent assumptions. a. No agreement concerning division of net income b. Divided in the ratio of original capital investment. C. Interest at the rate of 18% allowed on original investments and the remainder divided in the ratio) of 2:3. d. Salary allowances of $88,000 and $122,000, respectively, and the balance divided equally e. Allowance of interest at the rate of 18% on original investments, salary allowances of $88,000 and $122,000, respectively, and the remainder divided equally. Hawes Albright (c) $Explanation / Answer
a Hawes 141000 =282000/2 Albright 141000 =282000/2 b Hawes 169200 =282000/(331200+220800)*331200 Albright 112800 =282000/(331200+220800)*220800 c Hawes Albright Interest on capital@18% 59616 39744 Remaining income 73056 109584 Total 132672 149328 d Hawes Albright Salary allowance 88000 122000 Remaining income 36000 36000 Total 124000 158000 e Hawes Albright Interest on capital@18% 59616 39744 Salary allowance 88000 122000 Remaining income -13680 -13680 Total 133936 148064