Question

Marcus is to receive 30% of the profits from partnership Cowboy Boots, before taking into account...

Marcus is to receive 30% of the profits from partnership Cowboy Boots, before taking into account any quaranteed payments, but not less than $15,000. If the partnership's income is $30,000 before taking into account guaranteed payments, how much does Marcus receive as a quaranteed payment? A. $0, B. $9,000. C. $15,000. D. $24,000

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Answer #1

Answer is option (C). $15000

Explanation;

Partnership income before taking into account guaranteed payments is given = $30000

Marcus share in income of partnership is given = 30%

Hence Marcus will receive ($30000 * 0.30) = $9000

But it is given that Marcus will not receive less than $15000 hence $9000 is low in compare to $15000

Thus Marcus receive as a quaranteed payment = $15000

Note:

Please see this case too;

As distributative share to Marcus will be ($30000 * 0.30) = $9000

And it is given that minimum payment limit is given = $15000

Thus guaranteed payment to Marcus ($15000 – $9000) = $6000

But $6000 is not given in the options hence I have assumed that total minimum payment to Marcus has been taken as guaranteed payment in your question.

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