70.2K

Verified Solution

Link Copied!

Dividing Partnership Income

Black and Shannon have decided to form a partnership. They have agreed that Black is to invest $$246,000$ and that Shannon is to invest $$82,000.$ Black is to devote one$-$half time to the business, and Shannon is to devote full time. The following plans for the division of income are being considered:

Equal division.

In the ratio of original investments.

In the ratio of time devoted to the business.

Interest of $6\%$ on original investments and the remainder equally.

Interest of $6\%$ on original investments, salary allowances of $$45,000$ to Black and $$85,000$ to Shannon, and the remainder equally.

Plan $($e$),$ except that Shannon is also to be allowed a bonus equal to $20\%$ of the amount by which net income exceeds the total salary allowances.

Required:

For each plan, determine the division of the net income under each of the following assumptions: $(1)$ net income of $$148,000$ and $(2)$ net income of $$220,000.$ Round answers to the nearest whole dollar.

$(1)(2)$

$$148,000$ $$220,000$

Plan Black Shannon Black Shannon

a$.$ $fill in the blank $1$

$fill in the blank $2$

$fill in the blank $3$

$fill in the blank $4$

b$.$ $fill in the blank $5$

$fill in the blank $6$

$fill in the blank $7$

$fill in the blank $8$

c$.$ $fill in the blank $9$

$fill in the blank $10$

$fill in the blank $11$

$fill in the blank $12$

d$.$ $fill in the blank $13$

$fill in the blank $14$

$fill in the blank $15$

$fill in the blank $16$

e$.$ $fill in the blank $17$

$fill in the blank $18$

$fill in the blank $19$

$fill in the blank $20$

f$.$ $fill in the blank $21$

$fill in the blank $22$

$fill in the blank $23$

$fill in the blank $24$

Check My Work

Answer & Explanation Solved by verified expert

See Answer