Mock Is Admitted to a Partnership with a 25% Capital

question 5

Multiple Choice

Mock is admitted to a partnership with a 25% capital interest by a cash investment of $120,000. If total capital of the partnership is $520,000 before admitting Mock, the bonus to Mock is

• A) $40,000.
• B) $20,000.
• C) $60,000.
• D) $80,000.

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Definitions:

Standard Normal Random Variable

A random variable with a mean of zero and a standard deviation of one, following the standard normal distribution, which is a specific instance of the normal distribution.

Average Balance

Average balance is a financial term referring to the sum of all balances during a certain period divided by the number of days in that period, often used in banking to assess fees or determine interest.

Standard Deviation

An evaluation of how spread out or dispersed a collection of data points is.

Normally Distributed

A data distribution pattern that follows the normal (bell curve) distribution.