Assume that the M & L partnership agreement gave March 60% and Ludwig 40% of partnership income and losses. The partnership lost $27,000 in the current period. This implies that March's share of the loss equals $16,200, and Ludwig's share equals $10,800.
March's Share of Loss = Net Loss * Allocation Percentage
March's Share of Loss = $27,000 * 60% = $16,200
Ludwig's Share of Loss = Net Loss * Allocation Percentage
Ludwig's Share of Loss = $27,000 * 40% = $10,800

Question

Quizplus · Accepted Answer

The calculation and allocation of the partnership loss based on the partnership agreement is correct, and therefore, the answer is true.

Assume That the M & L Partnership Agreement Gave March