Answer:
Owens will get $18,000 + $12,000 = $30,000
Explanation:
average capital investments:
- Owens $100,000
- Gehrig $200,000
- Nagurski $300,000
Net income = $90,000
Owens received a $18,000 salary
Remaining income = $72,000
interest on capital investment = $600,000 x 15% = $90,000
since $90,000 ≥ $72,000, profits must be allocated proportionally:
Owens = $72,000 x 1/6 = $12,000
Gehrig = $72,000 x 2/6 = $24,000
Nagurski = $72,000 x 3/6 = $36,000
