Partnership net income of $135,000 is to be divided between two partners,Ross Trane and Jane Winder,according to the following arrangement: There will be salary allowances of $40,000 for Trane and $50,000 for Winder,with the remainder divided one-third and two-thirds respectively per their partnership agreement.How much of the net income will be distributed to Trane and Winder,respectively?
A) $45,000 and $90,000
B) $30,000 and 15,000
C) $15,000 and $30,000
D) $55,000 and $80,000

Question

Partnership net income of $135,000 is to be divided between two partners,Ross Trane and Jane Winder,according to the following arrangement: There will be salary allowances of $40,000 for Trane and $50,000 for Winder,with the remainder divided one-third and two-thirds respectively per their partnership agreement.How much of the net income will be distributed to Trane and Winder,respectively?
A) $45,000 and $90,000 
B) $30,000 and 15,000 
C) $15,000 and $30,000 
D) $55,000 and $80,000

Quizplus · Accepted Answer

Total salary allowances = $40,000 + $50,000 = $90,000

Remaining income = $135,000 - $90,000 = $45,000

One-third of remaining income = $45,000/3 = $15,000

Two-thirds of remaining income = 2($45,000/3) = $30,000

Total distribution:
Trane = $40,000 (salary) + $15,000 = $55,000
Winder = $50,000 (salary) + $30,000 = $80,000

Therefore, Trane will receive $55,000 and Winder will receive $80,000. Answer is D.

Partnership Net Income of $135,000 Is to Be Divided Between