Help with accounting/finance

Accounting
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Allison and Josh are partners in a business. Allison’s capital is $60,000, and Josh’s capital is $100,000. Profits for the year are $80,000. They agree to share profits and losses as follows:
      Allison     Josh
Salaries     $20,000     $40,000
Interest on capital     10%     10%
Remaining profits and losses     3/5     2/5

Allison’s share of the profits before paying salaries and interest on capital is:
A.
$48,000.    
B.
$22,000.    
C.
$28,000.
D. $28,400.

Apr 28th, 2015

profit and loss sharing ratios Allison 3/5 and Josh 2/5

Solution

profits=$80,000

before salaries and interest on capital

Allison=3/5*80000= 0.6*80000

Allison's share of profit=48000

i.e.

A. $48,000

Apr 28th, 2015

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