Badger and Fox Are Forming a Partnership

question 119

Multiple Choice

Badger and Fox are forming a partnership. Badger invests a building that has a market value of $350,000; the partnership assumes responsibility for a $125,000 note secured by a mortgage on the property. Fox invests $100,000 in cash and equipment that has a market value of $75,000. For the partnership, the amounts recorded for total assets and for total capital account are:

• A) Total assets $525,000; total capital $400,000.
• B) Total assets $400,000; total capital $400,000.
• C) Total assets $650,000; total capital $650,000.
• D) Total assets $400,000; total capital $525,000.
• E) Total assets $525,000; total capital $525,000.

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Definitions:

Complicating Factor

An element or condition that introduces difficulty, complexity, or an obstacle to resolving an issue or achieving a goal.

Cross-Cultural Communication

The process of recognizing and understanding the differences and similarities in communication styles across different cultures to enhance interaction.

Ethnocentrism

The tendency to believe that your culture or ethnicity is superior to everyone else’s.

Downward

Refers to communications or relationships that move from higher levels of hierarchy to lower levels within an organizational structure.