Cleary, Wasser, and Nolan Formed a Partnership on January 1

question 72

Multiple Choice

Cleary, Wasser, and Nolan formed a partnership on January 1, 2012, with investments of $100,000, $150,000, and $200,000, respectively. For division of income, they agreed to (1) interest of 10% of the beginning capital balance each year, (2) annual compensation of $10,000 to Wasser, and (3) sharing the remainder of the income or loss in a ratio of 20% for Cleary, and 40% each for Wasser and Nolan. Net income was $150,000 in 2012 and $180,000 in 2013. Each partner withdrew $1,000 for personal use every month during 2012 and 2013.
What was Wasser's capital balance at the end of 2013?

• A) $201,000.
• B) $263,520.
• C) $264,540.
• D) $304,040.
• E) $313,780.

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Definitions:

Skewness

A measure of the asymmetry of the probability distribution of a real-valued random variable, indicating how much the distribution leans to one side of the mean.

Positively Skewed

Describes a distribution of data where the tail on the right side of the histogram is longer or fatter than the left side, indicating that the majority of the data points are clustered to the left.

Histogram

A graphical representation of data using bars of different heights to illustrate the distribution of variables within intervals.