Jennifer Wyatt and Megan Truett formed a partnership, investing $330,000 and $11

Question

Jennifer Wyatt and Megan Truett formed a partnership, investing $330,000 and $110,000, respectively.

Determine their participation in the year's net income of $420,000 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 8% allowed on original investments and the remainder divided in the ratio of 2:3.
d.Salary allowances of $50,000 and $70,000, respectively, and the balance divided equally.
e.Allowance of interest at the rate of 8% on original investments, salary allowances of $50,000 and $70,000, respectively, and the remainder divided equally.

Explanation / Answer

The first 2 (A & B) are correct, on C. you have to add 26,400+153,920 and 8,800+230,880 to get the right answer which is 180320 & 239680.

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