Greg and Harriet are partners in GH partnership. Greg originally contributed $50,000 while Harriet contributed $150,000. Greg works full-time while Harriet works part-time. During the year, GH Partnership earned $120,000 in net income. Determine how much of this $120,000 would be allocated to each partner under each of the following profit/loss sharing agreements. a. There is no agreement. Greg Harriet b. In the ratio of original capital investments. Greg Harriet c. In the ratio of time devoted to the business. Greg Harriet d. 10% of original capital investments and the remainder equally. Greg Harriet e. 10% of original capital investments, a salary allowance of $30,000 for Greg, and the remainder equally. Greg Harriet
Greg and Harriet are partners in GH
a. There is no agreement.
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Greg |
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Harriet |
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b. In the ratio of original capital investments.
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Greg |
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Harriet |
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c. In the ratio of time devoted to the business.
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Greg |
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Harriet |
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d. 10% of original capital investments and the remainder equally.
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Greg |
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Harriet |
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e. 10% of original capital investments, a salary allowance of $30,000 for Greg, and the remainder equally.
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Greg |
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Harriet |
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