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:

Poverty Rate

The proportion of a population living below the national poverty line, indicating the level of economic deprivation.

Married-Couple Families

Families consisting of a married couple and their children, if any, living together as a unit.

Poverty Rate

A measure indicating the percentage of the population living below the nationally established poverty line, reflecting the proportion of society facing severe economic hardship.

African Americans

A population segment in the United States made up of people who have full or partial heritage from any black racial groups originating in Africa.