FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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Kate DeLeo and Joe Desmond decided to form a partnership on January 1. DeLeo invested $50,000 and Desmond invested $30,000. On December 31, the end of the fiscal year, a net income of $100,000 was earned. Determine the amount of net income that DeLeo and Desmond would receive under each of the following independent assumptions:

Net income     $fill in the blank 1
Income to be allocated DeLeo Desmond Total
a.  There is no agreement concerning the distribution of net income. $fill in the blank 2 $fill in the blank 3 $fill in the blank 4
b.  Each partner is to receive 10% on their original investment, and the remainder divided equally. $fill in the blank 5 $fill in the blank 6 $fill in the blank 7
c.  DeLeo and Desmond are to receive a salary allowance of $35,000 and $45,000 respectively, and the remainder divided equally. $fill in the blank 8 $fill in the blank 9 $fill in the blank 10
d.  Each partner is to receive 10% on their original investment, DeLeo and Desmond are to receive a salary allowance of $30,000 and $40,000 respectively, and the remainder divided as follows: 60% to DeLeo and 40% to Desmond.

 

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