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

question 27

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, 2018, 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:

Nuclear Family

A family unit that consists of parents (both a mother and a father) and their biological or adopted children, living together as a single household.

Mate Selection

The process by which individuals choose partners with whom to form a romantic or sexual relationship.

Love

is a complex emotion characterized by deep affection, attachment, and care towards someone or something.

Extended Family

A family group that extends beyond the nuclear family, including relatives such as grandparents, aunts, uncles, and cousins.