Fontaine and Monroe Are Forming a Partnership

question 103

Multiple Choice

Fontaine and Monroe are forming a partnership. Fontaine invests a building that has a market value of $250,000; the partnership assumes responsibility for a $75,000 note secured by a mortgage on the property. Monroe invests $100,000 in cash and equipment that has a market value of $55,000.
-For the partnership, the amounts recorded for the building and for Fontaine's Capital account are:

• A) Building $250,000; Fontaine, Capital $75,000.
• B) Building $250,000; Fontaine, Capital $250,000.
• C) Building $250,000; Fontaine, Capital $175,000.
• D) Building $175,000; Fontaine, Capital $175,000.
• E) Building $175,000; Fontaine, Capital $75,000.

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Definitions:

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The arrangement of roles, responsibilities, and relationships within an organization, defining how activities are directed towards achieving its goals.

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