Required information [The following information applies to the questions display

Question

Required information

[The following information applies to the questions displayed below.]
  
Ramer and Knox began a partnership by investing $90,000 and $135,000, respective

allowance to Knox, 8% interest on their initial capital investments, and the remaining balance shared equally. Net income is $.260,000 Enter all allowances as positive values. Enter losses as negative values.) Ramer Knox Total Net Income Salary allowances Interest allowances Total salary and interest 0 0 Balance of income Balance allocated equally Balance of income Shares of the partners

Explanation / Answer

Solution

Schedule for Distribution of Income

$7200

($90000*8%)

$10800

($135000*8%)

Particulars Ramer Knox Total Net Income (A) $260000 Salary Allowances $70000 $44000 $114000 Interest Allowances 8%

$7200

($90000*8%)

$10800

($135000*8%)

$18000 Total Salary and Interest (B) $132000 Balances of accounts (A-B) $128000 Balances allocated equally ($128000/2) $64000 $64000 $128000 Balance of Income $0 Share of the partners $141200 $118800

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