A Partnership Began Its First Year of Operations with the Following

question 77

Multiple Choice

A partnership began its first year of operations with the following capital balances: The Articles of Partnership stipulated that profits and losses be assigned in the following manner:Young was to be awarded an annual salary of $26,000 and $13,000 salary was to be awarded to Thurman.Each partner was to be attributed with interest equal to 10% of the capital balance as of the first day of the year.The remainder was to be assigned on a 5:2:3 basis to Young, Eaton, and Thurman, respectively.Each partner withdrew $13,000 per year.Assume that the net loss for the first year of operations was $26,000 with net income of $52,000 in the second year.What was Thurman's total share of net income for the second year?

• A)$17,160 income.
• B)$4,160 income.
• C)$19,760 income.
• D)$17,290 income.
• E)$28,080 income.

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Definitions:

Corporations

Legal entities that are separate and distinct from their owners, capable of owning property, entering into contracts, and being sued.

Law Professors

Educators and scholars in the field of law who teach and conduct research at law schools, contributing to the education of future lawyers and the development of legal theory.

Low-Paid Secretaries

Secretarial staff who receive wages at the lower end of the pay scale, often reflecting issues of undercompensation and undervaluation.

Attorneys

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