Applying the Interest Allowance Method,compute Taylor and Timmy's Share of Net

Multiple Choice

Applying the interest allowance method,compute Taylor and Timmy's share of net income if Taylor invested $300,000 and Timmy invested $700,000 at a 6% interest rate,with the remainder to be divided equally.Net income was $80,000.

A) Taylor,$24,000;Timmy,$56,000
B) Taylor,$40,000 Timmy,$40,000
C) Taylor,$28,000;Timmy,$52,000
D) None of these answers is correct.