Ashe and Barbour are partners with capital balances on January 1, 2011, of $40,000 and $50,000, respectively. The partnership agreement provides that each partner is allowed 10 percent interest on beginning capital balances; that Ashe receives a salary allowance of $12,000 per year and a 20 percent bonus of partnership income after interest, salary allowance, and bonus; and that remaining income is divided equally.
REQUIRED: Prepare an income distribution schedule to show how the $105,000 partnership net income for 2011 should be divided.