Print Item Net Income Required: Steve Prince and Chelsy Bernard formed a pertner

Question

Print Item Net Income Required: Steve Prince and Chelsy Bernard formed a pertnership, dividing income as follows: 1. Annual salary allowance to Bernard of $179,550. 2. Interest of 6% on each partner's capital balance on January 1. 3. Any remaining net Income divided to Prince and Bernard, 1:2 Prince and Bernard had $83,120 and $90,040, respectively, in their January 1 capital balances. Net income for the year was $315,000. How much is distributed to Prince and Bernard? Note: Compute partnership share to two decimal places. Round final answers to the nearest whole dollar Set upacoum for each tner and stal column. The amount of net income tat should be dsmb ted to each paner should ndidete pares uary anowance, the interest on me partner's capital baliance, and any nemaining income divided based on the partnership agreement. t the net income is less than the total of the salary and interest allowances, then the remaining net income to divide is a negative amount, as though it were a net losts

Explanation / Answer

*(315,000-179550-4987-(6% of 90,040) * 1:2 ratio

= 125,061 * 1:2

Prince = 125,061*(1/3) = $41,687

Bernard = 125,061*(2/3) = $83,374

(315,000-179550-5402-(6% of 83,120) * 1:2 ratio

= 125,061 * 1:2

Prince = 125,061*(1/3) = $41,687

Bernard = 125,061*(2/3) = $83,374

Annual salary 179,550 Interest (6% of 83120) 4987 Remaining income 41,687* Total distributed to Steve Prince $226,224

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