The partnership of Smith and Jones, who have average capital balances of $17,000 and $23,000, respectively, earned $90,000 net income. Under each of the following independent situations, calculate the distribution of the $90,000.
a) No agreement was established.
b) Share based on their average capital balances.

Question

Tuan Lam Luong Vu · Accepted Answer

Final Answer : a) Smith, $45,000; Jones, $45,000b) Smith, $38,250; Jones, $51,750

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