The Flat and Iron partnership agreement provides for Flat to receive a 20% bonus on profits before the bonus. Remaining profits and losses are divided between Flat and Iron in the ratio of 2:3, respectively. Which partner has a greater advantage when the partnership has a profit or when it has a loss?
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|
Profit |
Loss |
|
|
a. |
Flat |
Iron |
|
b. |
Flat |
Flat |
|
c. |
Iron |
Flat |
|
d. |
Iron |
Iron |