Florida Contractor Practice Exam

If three partners invest $30,000, $20,000, and $15,000 and the partnership earns $244,000, how much will Noah, who invests $30,000 and receives $5,000 for management, get?

1. Less than $70,000

2. Between $70,000 - $90,000

3. Between $90,000 - $110,000

4. More than $110,000

The correct answer is: More than $110,000

To determine how much Noah will receive from the partnership, we first need to calculate the total investment from all partners and the profit share that Noah is entitled to, based on his investment. The total investment from the three partners is $30,000, $20,000, and $15,000, which sums up to $65,000. The partnership earns a total of $244,000. From this amount, we first account for the management fee that Noah receives, which is $5,000. This leaves us with remaining profits of $244,000 - $5,000 = $239,000. Next, we need to figure out how profits are distributed among the partners. Each partner typically receives a share based on their initial investment relative to the total investment. Since Noah invested $30,000 and the total investment is $65,000, his share of the profits can be calculated by dividing his investment by the total investment, which is $30,000 / $65,000. This gives Noah a percentage stake in the partnership profits. Now, we calculate Noah's share of the remaining profits of $239,000. The calculation would look like this: Noah's share of the profits = (Noah's