Partners Brian,Josh,and Chad Have Capital Balances of $8,000,$6,000,and $80,000,respectively

question 105

Multiple Choice

Partners Brian,Josh,and Chad have capital balances of $8,000,$6,000,and $80,000,respectively.The losses for the year are $10,000.What will Josh's capital balance be if the three partners share profits and losses at a 2:2:6 ratio for Brian,Josh,and Chad,respectively?

• A)$4,000 debit balance
• B)$1,000 debit balance
• C)$2,400 debit balance
• D)$4,000 credit balance

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Definitions:

Business Judgment

refers to the decision-making process by corporate directors and officers that is presumed to be in the best interest of the company, protecting them from liability if the decisions are made in good faith and with reasonable care.

Counteroffer

A proposal made in response to an offer, signaling rejection of the initial offer and suggesting a new agreement for negotiation.

Acceptance

The agreement to the terms of an offer, contract, or proposal, thereby creating a binding legal obligation.

Roof

The structure covering the top of a building, designed to protect against weather, animals, and other external factors.