Terry and Jim are both involved in operating illegal busines…
Terry and Jim are both involved in operating illegal businesses. Terry operates a gambling business, and Jim operates a business selling narcotics. Both businesses have gross revenues of $500,000. The businesses incur the following expenses: Terry JimEmployee salaries $200,000 $200,000Bribes to police 25,000 25,000Rent and utilities 50,000 50,000Cost of goods sold –0– 125,000 Which of the following statements is correct?