A Partnership Began Its First Year of Operations with the Following

question 74

Multiple Choice

A partnership began its first year of operations with the following capital balances: The Articles of Partnership stipulated that profits and losses be assigned in the following manner:Young was to be awarded an annual salary of $26,000 and $13,000 salary was to be awarded to Thurman.Each partner was to be attributed with interest equal to 10% of the capital balance as of the first day of the year.The remainder was to be assigned on a 5:2:3 basis to Young, Eaton, and Thurman, respectively.Each partner withdrew $13,000 per year.Assume that the net loss for the first year of operations was $26,000 with net income of $52,000 in the second year.What was the balance in Thurman's Capital account at the end of the first year?

• A) $120,900.
• B) $118,300.
• C) $126,100.
• D) $80,600.
• E) $111,500.

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Definitions:

Ampulla

A widening or dilation in a tubular structure, such as the ampulla of Vater in the digestive system or the ampullae of the fallopian tubes.

Infundibulum

A funnel-shaped structure, often referring to the connection between the hypothalamus and the pituitary gland or the passageway in the female reproductive system leading to the fallopian tubes.

Testosterone

A primary male sex hormone responsible for the development of male secondary sexual characteristics.

Interstitial Cells

Specialized cells in the testes responsible for the production of testosterone.