Emerson and Dakota formed a partnership dividing income as follows:?
1. Annual salary allowance to Emerson of $58,000
2. Interest of 8% on each partner's capital balance on January 1
3. Any remaining net income divided equally?Emerson and Dakota had $25,000 and $140,000, respectively, in their January 1 capital balances. Net income for the year was $220,000.?How much net income should be distributed to Dakota?

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Daniel Moran · Accepted Answer

Final Answer :  ?    Sal ary  $ 0  Interest  ( 8 % × $ 140 , 000 ) 11 , 200  Remaining income  74 , 40 0 ∗  Total distribution to Emerson  $ 85 , 600 ‾ \begin{array}{ll}	ext { Sal ary }  &  \$ 0 \	ext { Interest }(8 \% 	imes \$ 140,000)  &  11,200 \	ext { Remaining income }  &  74,400^{*} \	ext { Total distribution to Emerson }  &  \underline{\mathbf{\$ 8 5 , 6 0 0}}\end{array}  Sal ary   Interest  ( 8% × $140 , 000 )  Remaining income   Total distribution to Emerson  ​ $0 11 , 200 74 , 40 0 ∗ $85 , 600 ​ ​   * ($220,000 - $58,000 - $2,000 - $11,200) × 50% = $74,400

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