Question

Asahi, an active partner in the Sora-Wilson partnership, receives an annual bonus of 20% of partnership net income after deducting the bonus. For the year ended 2017, partnership income before the bonus was $150,000. Asahi should receive a bonus of___________.

Answer 1

Answer:

$25,000

Explanation:

Let x = partnership income after deducting bonus

Bonus = 20% of x = 0.2x

Partnership income before bonus = x + 0.2x

                                                         = 1.2x

If partnership bonus = $150,000

1.2x = $150,000

x = $150,000/1.2

x = $125,000

Asahi's bonus = 0.2x

                        = 0.2 ×$125,000

                        = $25,000