It is possible to allocate income or loss to partners based solely on the stated ratio.

Question

Quizplus · Accepted Answer

Partnerships typically allocate income or loss to partners based on their agreed-upon ratio or percentage ownership in the business. This is a common way to divide profits and losses and is generally accepted as a fair and equitable method of distribution. However, it's worth noting that there may be certain circumstances where a different approach is necessary, such as when one partner contributes more to the partnership than others or when there are unusual expenses or income items that need to be accounted for in a different way.

It Is Possible to Allocate Income or Loss to Partners