Problemmcgill and smyth have capital balances on january 1, Ask an Expert

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McGill and Smyth have capital balances on January 1 of $41,000 and $48,000, respectively. The partnership income-sharing agreement provides for (1) annual salaries of $15,000 for McGill and $11,000 for Smyth, (2) interest at 11% on beginning capital balances, and (3) remaining income or loss to be shared 70% by McGill and 30% by Smyth.

(1) Prepare a schedule showing the distribution of net income, assuming net income is $74,000.

(2) Prepare a schedule showing the distribution of net income, assuming net income is $27,000.

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M92751761

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