Gary, Peter, and Chris Own a Firm as Partners

question 127

Multiple Choice

Gary, Peter, and Chris own a firm as partners. Gary has a capital balance of $25,000; Peter a capital balance of $40,000; and Chris has a capital balance of $31,000. As per the partnership agreement, Gary gets a profit share of 2/9; Peter has 4/9; and Chris has 3/9. Which of the following is true, if Gary withdraws from the partnership by receiving $25,000?

• A)Peter, Capital and Chris, Capital will be credited for $12,500 each.
• B)Gary, Capital will be debited for $25,000.
• C)Cash is debited for $25,000.
• D)Peter, Capital will be credited for $25,000.

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Definitions:

Declarative Memory

A type of long-term memory that involves the recall of specific facts and events, which can be consciously retrieved and articulated.

Chronological Recollections

Memories arranged or remembered in the order of their occurrence in time.

Episodic

Related to events or experiences that are temporal in nature and can be explicitly recalled, often part of episodic memory.

Episodic Memory

A kind of enduring memory focusing on the retrieval of distinct moments, scenarios, and personal encounters, incorporating both the emotional and environmental aspects related to them.