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Martha and Jones have capital balances on January 1 of $50,000 and $40,000, respectively. The partnership income-sharing agreement provides for (1) annual salaries of $20,000 for Martha and $12,000 for Jones, (2) interest at 10% on beginning capital balances, and (3) remaining income or loss to be shared 60% by Martha and 40% by Jones. (a) (If an amount reduces the account balance then enter with a negative sign preceding the number or parenthesis, e.g. -15,000, (15,000).)
(1) Prepare a schedule showing the distribution of net income, assuming net income is $50,000.
(2) Prepare a schedule showing the distribution of net income, assuming net income is $36,000.
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