Question

Calculator Dividing Partnership Net Income Required: Steve Conyers and Chelsy Bowerformed a partners , dividing income as follows 1. Annual salary allowance to Boxer of $179,760. 2. Interest of 5% on each partner's capital balance on January 1 3. Any remaining net income divided to Conyers and Boxer, 112. Conyers and Bower had $72.000 and $87,000, respectively, in the January 1 c e s et income for the year was $321,000. How much is trued to Canyers and Boer? hare Note: Compute parte Conyers Boxer

Answer 1

Net income = $321,000

Salary allowance to Boxer = $179,760

Interest allowance to Conyers = 72,000 x 5%

= $3,600

Interest allowance to Boxer = 87,000 x 5%

= $4,350

Remaining net income after salary and interest allowance = Net income - Salary allowance to Boxer - Interest allowance to Conyers - Interest allowance to Boxer

= 321,000 - 179,760 - 3,600 - 4,350

= $133,290

Conyers share of remaining net income = 133,290 x 1/3

= $44,430

Boxer share of remaining net income = $88,860

	Conyers	Boxer
Salary allowance		179,760
Interest allowance	3,600	4,350
Share of remaining net income	44,430	88,860
Partnership share	$48,030	$272,970

Conyers	$48,030
Boxer	$272,970

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