Asked by Alice Reeves on Jun 14, 2024
Verified
Sam, Domenic, and Sal invested $100,000, $150,000 and $75,000 respectively in a business. The profits from last year were $80,000. How much of the profits should each partner receive?
A) $24,615.38; $36,923.08; $18,461.54
B) $25,000; $35,000; $10,000
C) $20,000; $35,000; $15,000
D) $24,615.38; $18,461.54; $36,923.08
E) $36,923.08; $18,461.54; $24,615.38
Profits
The financial gain realized when the revenues generated from business activities exceed the expenses, costs, and taxes needed to sustain the activity.
Partnership
A business setup legally recognized, involving two or more partners sharing both management responsibilities and profits.
- Determine the distribution of investments and calculate the division of earnings among partners according to specific ratios.
Verified Answer
LD
ladan dabaghpoorkhoeiJun 20, 2024
Final Answer :
A
Explanation :
The total investment is $325,000 ($100,000 + $150,000 + $75,000). The profit shares are proportional to the investments: Sam ($100,000/$325,000), Domenic ($150,000/$325,000), and Sal ($75,000/$325,000). Calculating these fractions of the $80,000 profit gives $24,615.38 for Sam, $36,923.08 for Domenic, and $18,461.54 for Sal.
Learning Objectives
- Determine the distribution of investments and calculate the division of earnings among partners according to specific ratios.
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