Applying the Profit and Loss Ratio Method, Compute Taylor and Timmy's

question 32

Multiple Choice

Applying the profit and loss ratio method, compute Taylor and Timmy's share of net income if Taylor invested $200,000 and Timmy invested $800,000 and the profit and loss ratio is 3:2. Net income was $70,000.

• A) Taylor, $14,000; Timmy, $56,000
• B) Taylor, $35,000; Timmy, $35,000
• C) Taylor, $42,000; Timmy, $28,000
• D) None of these answers is correct.

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Definitions:

Conception

The process of fertilization where a sperm and egg combine, leading to the formation of a zygote and the beginning of pregnancy.

Prenatal Development

The development and growth journey inside the womb, starting from conception and culminating in birth.

Adult Personality

The patterns of thought, feeling, and behavior that are characteristic of an individual and that are typically fully developed or matured in adulthood.

Early Childhood

A developmental period ranging from birth to eight years old, focusing on the growth and learning of young children.