Nguyen invested $8,000 and Hansen invested $12,000 in a partnership. They agreed to share incomes and losses by allowing a $9,000 per year salary allowance to Nguyen and a $12,000 per year salary allowance to Hansen, plus interest on the partners'investments at 10%, with the balance to be shared equally. Under this agreement, the shares of the partners with a $51,000 profit are:
A) $26,000 to Nguyen; $25,000 to Hansen.
B) $14,500 to Nguyen; $35,500 to Hansen.
C) $9,000 to Nguyen; $12,000 to Hansen.
D) $10,500 to Nguyen; $10,500 to Hansen.
E) $23,800 to Nguyen; $27,200 to Hansen.

Question

Quizplus · Accepted Answer

Nguyen's salary allowance is $9,000 and Hansen's is $12,000. Interest on Nguyen's investment is $800 (10% of $8,000) and on Hansen's is $1,200 (10% of $12,000). Total allowances and interest are $23,000. The remaining profit of $28,000 ($51,000 - $23,000) is shared equally, giving each $14,000. Nguyen's total share is $23,800 ($9,000 + $800 + $14,000) and Hansen's is $27,200 ($12,000 + $1,200 + $14,000).

Nguyen Invested $8,000 and Hansen Invested $12,000 in a Partnership