Partnership

A, B and C are in partnership selling DVDs. They haven’t been very successful in the past year and in the year ended 30 June 20X9, recorded a loss of $120,000 Their partnership agreement states the following: • interest on capital to be provided at 4% per annum • C to be allocated a salary of $25,000, and B $14,000 • no interest to be charged on drawings • balance of profits to be shared in the ratio 4:3:1. Capital balances at the start of the year stood as follows: A $35,000 B $26,000 C $40,000 How much profit or loss is allocated to C? A $6,220 B $36,220 C ($34,540) D ($54,920)