The Key Difference Between a Partnership Balance Sheet and a Standard

question 47

Multiple Choice

The key difference between a partnership balance sheet and a standard business balance sheet is that the partnership balance sheet:

• A)shows the division of each asset into partners' respective interests.
• B)shows a separate retained earnings amount for each partner.
• C)shows each partner's capital account as a separate item.
• D)includes ordinary shares but not Share capital in excess of par.

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Definitions:

Social Welfare Function

An economic function that ranks societal allocations of resources based on ethical principles, intending to maximize collective satisfaction or utility.

Utility Possibilities Frontier

The utility possibilities frontier is a graphical representation depicting the different distributions of utility maximization between two agents given a fixed set of resources.

Income Distribution

Income distribution refers to the way in which total income is shared among the members of a society.

Pareto Optimal

A distribution condition in which making any person's situation better is impossible without causing harm to someone else.