Rex baker and ty farney are forming a partnership to which

Assignment Help Cost Accounting

Reference no: EM13377836

Rex Baker and Ty Farney are forming a partnership to which Baker will devote one-half time and Farney will devote full time. They have discussed the following alternative plans for sharing income and loss:

(a) in the ratio of their initial capital investments, which they have agreed will be $21,000 for Baker and $31,500 for Farney;

(b) in proportion to the time devoted to the business;

(c) a salary allowance of $3,000 per month to Farney and the balance in accordance with the ratio of their initial capital investments; or

(d) a salary allowance of $3,000 per month to Farney, 10% interest on their initial capital investments, and the balance shared equally.

The partners expect the business to perform as follows: year 1, $18,000 net loss; year 2, $45,000 net income; and year 3, $75,000 net income.

Reference no: EM13377836

Questions Cloud

Nbsplisted below are several summary statements from the : nbsplisted below are several summary statements from the 2010 census reportthe official poverty rate in 2010 was 15.1

An increase in price in a market will all else remaining : an increase in price in a market will all else remaining constant increase the demand in the market for a good or

June 1 deposited the 150000 into a business account paid : june 1 deposited the 150000 into a business account. paid three months rent in advance of 3000. prepaid rent is treated

Assume that the companys is considering a merger the : assume that the companys is considering a merger. the possible merger currently faces some threats and that the

Rex baker and ty farney are forming a partnership to which : rex baker and ty farney are forming a partnership to which baker will devote one-half time and farney will devote full

During the energy crisis of the 1970s and again in the last : during the energy crisis of the 1970s and again in the last 5 years congress bemoaned the price gouging and windfall

Nomar industries inc operates in several lines of business : nomar industries inc. operates in several lines of business including the construction and real estate industries.

Can you explain this to me scatterplot yweight in april : can you explain this to me. scatterplot yweight in april xweight in september histogram frequency counts weight in

Felix and kim are farmerseach one owns 5 acres of land the : felix and kim are farmers.each one owns 5 acres of land the following table shows the amount of corn and alfelfa each

User Account

All Pages