The ace bet is usually worth twice the duece bet, but groups can agree on any amount. Ties for either the ace or the duece mean that no money is paid for that bet on that hole; carryovers are optional at the discretion of the group members (decide before the round starts).
It works like this: Let's say the ace bet is for $2 and the duece bet is for $1. On the first hole, Player A scores 4, B makes 5, C makes 5, D makes 6. A is the "ace" and wins $2 each from B, C and D. D is the "deuce" and owes $1 each to A, B and C. So A wins a total of $7 ($2 from each B, C and D, plus another $1 from D for being the "deuce"), B and C have a net loss of $1 (they each pay $2 to A but get $1 from D), and D pays out $5 ($1 to each for being the deuce, plus the $2 owed to A for his "ace" score).
As you can see, this game can get expensive in a hurry if high amounts are used and one or two players dominate. Be sure to play with players of similar skills, or use full handicaps, and to set a reasonable bet amount if you're not a high-roller.
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