FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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Exercise 12-6 (Algo) Income allocation in a partnership LO P2
Ramer and Knox began a partnership by investing $71,000 and $101,000, respectively. The partners agreed to share net income and
loss by giving annual salary allowances of $55,500 to Ramer and $44,400 to Knox, 10% interest allowances on their investments, and
any remaining balance shared equally.
Note: Enter all allowances as positive values. Enter losses as negative values.
ces
Required:
1. Determine each partner's share given a first-year net income of $109,800
2. Determine each partner's share given a first-year net loss of $27,800.
Complete this question by entering your answers in the tabs below.
Required 1 Required 2
Determine each partner's share given a first-year net loss of $27,800.
Allocation of Partnership Income
Ramer
Knox
Net Income (loss)
Salary allowances
Balance of income (loss)
Interest allowances
Balance of income (loss)
Balance allocated equally
Balance of income (loss)
Shares of the partners
< Required 1
$
Total
(27,800)
0
0
0
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Transcribed Image Text:Exercise 12-6 (Algo) Income allocation in a partnership LO P2 Ramer and Knox began a partnership by investing $71,000 and $101,000, respectively. The partners agreed to share net income and loss by giving annual salary allowances of $55,500 to Ramer and $44,400 to Knox, 10% interest allowances on their investments, and any remaining balance shared equally. Note: Enter all allowances as positive values. Enter losses as negative values. ces Required: 1. Determine each partner's share given a first-year net income of $109,800 2. Determine each partner's share given a first-year net loss of $27,800. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Determine each partner's share given a first-year net loss of $27,800. Allocation of Partnership Income Ramer Knox Net Income (loss) Salary allowances Balance of income (loss) Interest allowances Balance of income (loss) Balance allocated equally Balance of income (loss) Shares of the partners < Required 1 $ Total (27,800) 0 0 0
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