Reference no: EM131125763

1. Candace Hassell and Abby Lawson formed a partnership, investing $240,000 and $80,000, respectively. Determine their participation in the year's net income of $200,000 under each of the following independent assumptions:

(a) No agreement concerning division of net income;

(b) Divided in the ratio of original capital investment;

(c) Interest at the rate of 15% allowed on original investments and the remainder divided in the ratio of 2:3;

(d) Salary allowances of $50,000 and $70,000, respectively, and the balance divided equally;

(e) Allowance of interest at the rate of 15% on original investments, salary allowances of $50,000 and $70,000, respectively, and the remainder divided equally.