Goodman, Pinkman, and White Formed a Partnership on January 1

question 31

Multiple Choice

Goodman, Pinkman, and White formed a partnership on January 1, 2020, and made capital contributions of $125,000 (Goodman) , $175,000 (Pinkman) , and $250,000 (White) , respectively. With respect to the division of income, they agreed to the following: (1) interest of an amount equal to 10% of the that partner's beginning capital balance for the year; (2) annual compensation of $15,000 to Pinkman; and (3) the remainder of the income or loss to be split among the partners in the following percentages: (a) 20% for Goodman; (b) 40% for Pinkman; and (c) 40% for White. Net income was $200,000 in 2020 and $240,000 in 2021. Each partner withdrew $1,500 for personal use every month during 2020 and 2021.What was the total capital balance for the partnership at December 31, 2020?

• A) $804,000.
• B) $696,000.
• C) $750,000.
• D) $604,000.
• E) $496,000.

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Definitions:

Middle Age

The period in human life ranging from about 45 to 65 years old, often considered a time of adjustment to aging.

Psychic Energy

In psychoanalytic theory, the force or impulse that drives behaviors and processes in the human mind, originating from the id, ego, and superego.

Individuation Process

A concept in analytical psychology referring to the process by which an individual integrates the unconscious with their conscious mind, leading to the development of a unique personality.

Psyche

A term used to describe the human mind or soul, encompassing thoughts, feelings, and consciousness.