The terms of a partnership agreement provide that one of the partners is to receive a salary allowance of $30,000,plus a bonus of 20 percent of income after deduction of the bonus and the salary allowance.If income is $150,000,the bonus should be:
A)$18,000
B)$20,000
C)$24,000
D)$30,000

Question

Quizplus · Accepted Answer

To calculate the bonus, let's denote the bonus as B. According to the terms, the partner receives a salary of $30,000 plus a bonus of 20% of the income after deducting the bonus and the salary allowance. The income is $150,000. So, the equation to calculate the bonus would be:$$ B = 20\% \times (150,000 - 30,000 - B) $$$$ B = 0.20 \times (120,000 - B) $$$$ B = 24,000 - 0.20B $$$$ 1.20B = 24,000 $$$$ B = 24,000 / 1.20 $$$$ B = 20,000 $$Therefore, the correct bonus amount is $20,000.

The Terms of a Partnership Agreement Provide That One of the Partners