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\frac{12}{20}-\frac{5}{20}
Least common multiple of 5 and 4 is 20. Convert \frac{3}{5} and \frac{1}{4} to fractions with denominator 20.
\frac{12-5}{20}
Since \frac{12}{20} and \frac{5}{20} have the same denominator, subtract them by subtracting their numerators.
\frac{7}{20}
Subtract 5 from 12 to get 7.