Which Method of Allocation of Profits and Losses Is Based

question 74

Multiple Choice

Which method of allocation of profits and losses is based on a percent of initial investment of the partners?

• A) Salary allowance
• B) Salary expense
• C) Profit and loss ratio
• D) Interest allowance

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Definitions:

Predictable

The characteristic of an event or behavior that can be anticipated based on patterns or prior knowledge.

Behavior

Describes the actions or reactions of an organism or system, usually in response to stimuli or in the context of the environment or situation.

Group Cohesion

The extent to which members of a group stay together and feel bonded with one another.

Principles

Fundamental truths or propositions that serve as the foundation for a system of belief, behavior, or reasoning.