Home / Questions / Division of Income C Eastwood A North and M West are manufacturers’ representatives in th...

Division of Income C Eastwood A North and M West are manufacturers’ representatives in the architecture business Their capital accounts in the ENW partnership for 20X1 were as follows

Division of Income

C. Eastwood, A. North, and M. West are manufacturers’ representatives in the architecture busi- ness. Their capital accounts in the ENW partnership for 20X1 were as follows:

 

C. Eastwood, Capital

A. North, Capital

M. est, Capital

 

9/1 8,000

1/1

30,000

 

3/1 9,000

1/1

40,000

 

8/1

12,000

1/1

50,000

 

5/1

6,000

 

 

7/1

5,000

 

 

 

4/1

7,000

 

 

 

 

 

9/1

4,000

 

 

 

6/1

3,000

 

Required

For each of the following independent income-sharing agreements, prepare an income distribution schedule.

 

a. Salaries are $15,000 to Eastwood, $20,000 to North, and $18,000 to West. Eastwood receives a bonus of 5 percent of net income after deducting his bonus. Interest is 10 percent of ending capital balances. Eastwood, North, and West divide any remainder in a 3:3:4 ratio, respectively. Net income was $78,960.

Interest is 10 percent of weighted-average capital balances. Salaries are $24,000 to Eastwood,

$21,000 to North, and $25,000 to West. North receives a bonus of 10 percent of net income after deducting the bonus and her salary. Any remainder is divided equally. Net income was $68,080.

c. West receives a bonus of 20 percent of net income after deducting the bonus and the salaries.

Salaries are $21,000 to Eastwood, $18,000 to North, and $15,000 to West. Interest is 10 percent of beginning capital balances. Eastwood, North, and West divide any remainder in an 8:7:5 ratio, respectively. Net income was $92,940.

Jul 14 2020 Read more Less More

Answer (Solved)

question Subscribe To Get Solution

Recent Questions

Chat Now

Welcome to Live Chat

Welcome to MyCourseHelp Services, World's leading Academic solutions provider with Millions of Happy Students.

Please fill in the form