How losses would be distributed

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Reference no: EM131034268

Wally and Karen formed a partnership on January 1, 20XX. Their written partnership agreement stated that profits would be distributed in the same proportion as contributions, which were: Wally: $60,000; Karen: $40,000. There was no agreement as to how losses would be distributed. Which of the following is correct?

A. Both profits and losses will be distributed 50/50

B. Profits will be distributed 60/40; losses 50/50

C. Both profits and losses will be distributed 60/40

D. Both profits and losses will be distributed based on the amount of revenue each individual partner was responsible for in the ordinary course of business.

Reference no: EM131034268

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