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Issue:

Business

 

Written by:

Colleen D

 

Date added:

November 18, 2013

 

Level:

University

 

Grade:

A

 

No of pages / words:

2 / 509

 

Was viewed:

8456 times

 

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Essay content:

According to capital investments of the partners, and/or 3. According to the labor (or services) rendered by the partners. Profits and Loss Ratios. Partnership agreements frequently call for the division of profits and losses according to some ratio. Normally the ratio designed for the division of profits is also used for the division of losses, unless a specific provision to the contrary exists...
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This method obviously provides a simplified way of dividing profits and, if approached properly, may also provide an equitable division. Theoretically, the ratio should attempt to combine into one base the capital and service contributions made by the respective partners. Again, it is also important to note that a partner's interest in profits and losses is often different from the partner's interest in total partnership capital (net assets)...
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