After Closing the Temporary Owners' Equity Accounts into Income Summary

question 22

Multiple Choice

After closing the temporary owners' equity accounts into Income Summary, and after allocating the net income and closing the partners' drawing accounts, assume the partners' capital accounts had credit balances as follows: Yang, $20,000; Wolfe, $30,000; Stamatis, $45,000. Partners share profits and losses as follows: Yang, 20%; Wolfe, 30%; and Stamatis, 50%. If Yang purchased Stamatis's interest in the partnership for $40,000 cash, the amount entered in Yang's capital account is a

• A) $5,000 debit.
• B) $40,000 debit.
• C) $40,000 credit.
• D) $45,000 credit.

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Definitions:

Essence

The intrinsic, fundamental nature or most important quality of something or someone.

Triangulation

A method used in research to cross-validate data through the use of multiple sources, methods, or investigators to enhance accuracy.

Convergent Validations

A method of validating findings or results by corroborating them through different measures or tests within the same study.

Multiple Methodologies

The use of various research or work methods in combination to address a problem or study a phenomenon.