Tom,Dick and Harry are partners in the Wipeout Company.Their partnership income sharing agreement calls for Tom and Dick to receive salary allowances of $24,000 and $18,500,respectively.Any remaining income or loss is to be divided equally.If the company's income was $96,500,Dick's share would be:

Question

Quizplus · Accepted Answer

Tom and Dick's total salary allowance is $42,500 ($24,000 + $18,500).

Subtracting this from the company's income of $96,500 leaves $54,000 of remaining income to be divided equally among the three partners.

Therefore, each partner would receive $18,000 of the remaining income.

Dick's total share would then be his salary allowance of $18,500 plus his share of the remaining income of $18,000, for a total of $36,500 (option C).

Tom,Dick and Harry Are Partners in the Wipeout Company