Mark and Bonnie Are Partners

question 66

Multiple Choice

Mark and Bonnie are partners.Mark contributed $30,000 of capital to the partnership and Bonnie contributed $15,000.Mark does 70 percent of the partnership's work,while Bonnie does 30 percent.They agree that Mark will assume 60 percent of partnership losses and Bonnie 40 percent.They have not decided how to share profits.The partnership earns a profit of $90,000.What is Bonnie's share of the profits?

• A)$45,000
• B)$30,000
• C)$27,000
• D)$36,000

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Definitions:

Currently Collectible

Amounts due that can be expected to be received or realized in cash within the current accounting period.

Direct Write-off

A method of accounting where uncollectible receivables are written off to expense only when they are deemed non-collectible.

Allowance Account

A contra account related to accounts receivable that estimates the amount of receivables which may not be collected.

Allowance for Doubtful Accounts

This accounting practice represents a reserve for accounts receivable that may not be collectible, reflecting potential future losses due to credit sales.