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  3. on january 1, year 1, harry, hermione, and ron for

On January 1, Year 1, Harry, Hermione, and Ron form the partnership Magic Wands. Harry...

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Accounting

On January 1, Year 1, Harry, Hermione, and Ron form the partnership Magic Wands. Harry contributes his elder tree containing many branches suitable for making wands. The tree originally cost Harry $1,000 but now has an appraised value of $5,000. Herminone promises to provide accounting support, handle all contracts, human resource functions and similar functions while Ron promises to run the business on a day to day function. Hermione contributes $4,000 in start-up money while Ron can only contribute $1000 in start-up funds. Accordingly, the partnership agreement states that income is to be allocated accordingly: 1. Each partner is to get a 10% return on their beginning capital balance. 2. Ron is to receive $12,000 for operationg the business. 3. The remaining income or losses is to be allocated to Harry, Hermione, and Ron on a ratio of 30%, 30%, and 40% 4. Harry and Hermione can withdraw $500 a month each while Ron can withdraw $1,000. After great effort, the partnership is successful and earns income in each of the first three years: Year Income 1 $ 15,000 2 $ 45,000 3 $ 60,000 Make tables to allocate income and show ending capital balance at the end of each of the three Years.

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