Assume That the Capital of an Existing Partnership Is $130,000

question 38

Multiple Choice

Assume that the capital of an existing partnership is $130,000 and that existing assets are overvalued by $10,000. If an incoming partner acquires a 25% interest in the partnership for $37,000, goodwill traceable to the incoming partner is ____.

• A)$2,250
• B)$9,667
• C)$3,000
• D)$5,000

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Definitions:

Motivating Force

The innate or developed factors that stimulate and direct behavior towards achieving personal or collective goals.

First-born Children

Individuals born first in their familial hierarchy, often discussed in psychological research for their tendencies and qualities distinct from their siblings.

Center of Attention

A status or situation in which an individual, object, or topic is the main focus of others' interest or activity.

Value of Dreams

Represents the significance and meaning attached to dreams in understanding unconscious desires and conflicts.