Steve Prince and Chelsy Dane formed a partnership, dividing income as follows: Annual salary allowance to Prince of $179,220. Interest of 6% on each partner's capital balance on January 1. Any remaining net income divided to Prince and Dane, 1:2. Prince and Dane had $87,000 and $93,000, respectively, in their January 1 capital balances. Net income for the year was $309,000. How much net income should be distributed to Prince and Dane?

SWFT Comprehensive Volume 2019
42nd Edition
ISBN:9780357233306
Author:Maloney
Publisher:Maloney
Chapter21: Partnerships
Section: Chapter Questions
Problem 7BCRQ
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Steve Prince and Chelsy Dane formed a partnership, dividing income as follows:

  1. Annual salary allowance to Prince of $179,220.
  2. Interest of 6% on each partner's capital balance on January 1.
  3. Any remaining net income divided to Prince and Dane, 1:2.

Prince and Dane had $87,000 and $93,000, respectively, in their January 1 capital balances. Net income for the year was $309,000.

How much net income should be distributed to Prince and Dane?

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