Ambiguous profit allocation method Steps:

• This year, equal sharing means total profit = $12,000 × 2 =$24,000.
• Next year, L gets $10,000 salary; remaining profit shared with L at 1/3 (M at 2/3) yields P -$10,000 = 28,000 for M's $12,000.
• Alternative: profits shared L 1/3 P, M 2/3 P, salary deducted from M's share yields 2/3 P - $10,000 =$12,000, P = $33,000.
• Wording unclear on whether 1/3 share applies to total P or (P - salary); no definitive method given.

Why C is correct:

• Not; calculations yield $28,000 or$33,000, not $37,000.

Why the others are wrong:

• A: Matches deficiency adjustment case, but ignores salary timing.
• B: Matches equal sharing after salary, but ignores 1/3 ratio change.
• D: Matches M at 1/3 after salary, but contradicts L's 1/3 share.

Not enough information. Final answer: Not enough information.