Kramer and Knox began a partnership by investing $60,000 and $90,000, respectively. Assume that the partners agreed to share net income and loss by granting annual salary allowances of $50,000 to Kramer and $40,000 to Knox, 10% interest allowances on their investments, and any remaining balance shared equally. 1. Determine the partners' shares of Kramer and Knox given a first-year net income of $98,800. (Losses and amounts to be deducted should be entered with a minus sign.)
2. Determine the partners' shares of Kramer and Knox given a first-year net loss of $16,800. (Losses and amounts to be deducted should be entered with a minus sign.)