The Following Balance Sheet Information Is for the Partnership of Abel

question 11

Multiple Choice

The following balance sheet information is for the partnership of Abel, Boule, and Cayman: Figures shown parenthetically reflect agreed profit and loss sharing percentages. If assets on the initial balance sheet are fairly valued, Abele and Boule consent and Dann pays Cayman $225,000 for his interest; the revised capital balances of the partners would be

• A) Abele, $315,000; Boule, $495,000; Dann, $450,000.
• B) Abele, $315,000; Boule, $495,000; Dann, $420,000.
• C) Abele, $300,000; Boule, $570,000; Dann, $450,000.
• D) Abele, $300,000; Boule, $480,000; Dann, $420,000.

---

Definitions:

Process Manufacturers

Companies involved in production where raw materials are transformed through a chemical or mechanical process into a finished product.

Continuous Flow

A process in manufacturing that involves the constant movement of goods through the production system without any stoppages.

Product Costs

Costs incurred by a business to manufacture a product or acquire products for resale, including material, labor, and overhead.

Direct Materials

Raw materials that can be directly identified and easily traced to the manufacturing of finished goods.