Tom, Trey and Harry, three college students, decide it would be a good idea to provide research and word processing services for other students at CCGA for a fee. They advertise their business in the college newspaper under the name ABC Research and Writing Services. Tom contributes $250 in cash towards the venture, while Trey provides an old computer system with word processing software and Harry provides a laser printer. The friends do not discuss the nature of the business and do not enter into any type of written or oral agreement relating to the business. They merely begin working together in the hope of earning enough money to defray the latest in a series of tuition increases at their college over the past few years. What is the form of the business?

40- Using the same facts as in the previous question, assume that the value of the student's contribution to the business is as follows: Tom $250, Trey $1,20, and Harry $750. How will the profits of the business be distributed?

41- Using the same facts in question 40, how will the business losses be shared?

42- Using the same facts as in question 40, how would losses be shared if the friends had agreed that Tom was to receive 20% of the profits, Trey 50% and Harry 30%?

Answer rating: 100% (QA)

Business Structure and ProfitLoss Sharing 40 Form of Business Based on the information provided Tom ... View the full answer