It Is Agreed in the Partnership Agreement of R and B

question 30

Multiple Choice

It is agreed in the partnership agreement of R and B that profit and loss sharing arrangements will be based on the ratio of the partner's capital balances.R and B have capital balances of $100 000 and $50 000 respectively at the end of the accounting period.If profit is $42 000 the profit allocations of each of the partners is:

• A)R $21 000; B $21 000
• B)R $24 000; B $18 000
• C)R $28 000; B $14 000
• D)R $14 000; B $28 000

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