The Partners of Apple, Bere, and Carroll LLP Share Net

question 59

Multiple Choice

The partners of Apple, Bere, and Carroll LLP share net income and losses in a 5:3:2 ratio, respectively. The capital account balances on January 1, 2021, were as follows: The carrying amounts of the assets and liabilities of the partnership are the same as their current fair values. Dorr will be admitted to the partnership with a 20% capital interest and a 20% share of net income and losses in exchange for a cash investment. The amount of cash that Dorr should invest in the partnership is:

• A)$25,000.
• B)$30,000.
• C)$37,500.
• D)$75,000.
• E)$90,000.

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Definitions:

Professional Robber

An individual who engages in theft or burglary as a primary occupation, often with a high level of skill or planning.

Sense Of Guilt

An emotional experience that occurs when a person believes or realizes they have compromised their own standards of conduct or violated a moral standard.

Honest Enterprise

A business operation known for its integrity, ethical practices, and transparency in dealings.

Disrespect For Authority

A behavioral pattern characterized by defiance or disobedience towards figures or institutions of power.