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28 April, 16:23

29. Maxwell is trying to decide whether to accept a salary of $60,000 or a salary of $25,000 plus a bonus of 20% of net income after salaries and bonus as a means of allocating profit among the partners. Salaries traceable to the other partners are estimated to be $75,000. What amount of income would be necessary so that Maxwell would consider the choices to be equal? A. $175,000

B. $210,000

C. $285,000

D. $310,000

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  1. 28 April, 17:21
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    Maxwell world consider choice equal to $310000

    Explanation:

    given data

    accept a salary = $60,000

    salary = $25,000

    bonus = 20% of net income

    to find out

    amount of income would be necessary so that Maxwell would consider

    solution

    we get here income by bonus that is express as

    bonus = 2 (income - bonus - salary) ... 1

    3500 = 2 (income - (0.2 * 35000) - (0.2 * (75000 + 35000))

    solve it we get

    income = $310000

    so Maxwell world consider choice equal to $310000
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