Rank the Following in Order of Increasing Leaving Group Ability,putting

question 5

Multiple Choice

Rank the following in order of increasing leaving group ability,putting the worst leaving group first.

• A)IV < II < III < I
• B)III < IV < I < II
• C)II < IV < I < III
• D)I < III < II < IV

---

Definitions:

Bonus Method

An accounting method for recording partnership transactions where a new partner's investment is more than or less than the book value of the capital they are entitled to.

Capital Balance

The amount of capital recorded in a company's accounts, representing the sum of the initial capital invested and additional contributions, minus any withdrawals.

Goodwill

An intangible asset that arises when a business is acquired for more than the fair value of its net identifiable assets, representing future economic benefits.

Capital Balances

Refer to the cumulative amounts of money or value that partners or shareholders have contributed to a company, inclusive of earnings and minus any losses.