The salary,interest,and stated ratio method of allocation can still be applied when a net loss has occurred.

Question

Quizplus · Accepted Answer

The method of allocation is based on the proportions of each element (salary, interest, stated ratio) to the whole amount, and not on whether there is a profit or loss. Therefore, it can still be applied even if a net loss has occurred. However, the allocation will result in a negative amount for each element instead of a positive one.

The Salary,interest,and Stated Ratio Method of Allocation Can Still Be