Which of the Following Could Be Used as a Basis

question 83

Multiple Choice

Which of the following could be used as a basis to allocate profits among partners who are active in the management of the partnership?
1) allocation of salaries.
2) the number of years with the partnership.
3) the amount of time each partner works.
4) the average capital invested.

• A) 1 and 2.
• B) 1 and 3.
• C) 1, 2, and 4.
• D) 1, 3, and 4.
• E) 1, 2, 3, and 4.

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Definitions:

Issuing Bonds

The act of a corporation or government raising capital by borrowing from investors through the sale of bond securities.

Reinvesting Earnings

The practice of using a company's profits to invest back into the business to fund growth, expansion, or improvements rather than distributing it to shareholders as dividends.

Strategic Plan

A document that outlines an organization's long-term goals and the strategies it will use to achieve them.

Time Horizon

The length of time over which an investment or a project is expected to be pursued or a goal to be achieved.