Use the Following Information to Answer the Question(s) Below

question 4

Multiple Choice

Use the following information to answer the question(s) below.

A summary balance sheet for the Lemon, Mango, and Nobb partnership appears below. Lemon, Mango, and Nobb share profits and losses in a ratio of 2:3:5, respectively.
The partners agree to admit Oran for a one-fifth interest. The fair market value of partnership land is appraised at $200,000 and the fair market value of inventory is $175,000. The assets are to be revalued prior to the admission of Oran and there is $30,000 of goodwill that attaches to the old partnership.

-What will the profit and loss sharing ratios be after Oran's investment?

• A)1:2:4:2
• B)2:3:5:2
• C)3:4:6:2
• D)4:6:10:5

---

Definitions:

Dinoflagellates

Single-celled, mostly marine organisms with two flagella, often producing bioluminescence and sometimes forming toxic algal blooms.

Green Algae

Green algae are a diverse group of photosynthetic organisms found in various aquatic environments, and they are considered important for ecological balance and oxygen production.

Spores Asexually

Reproductive units formed without sexual reproduction, capable of developing into a new individual without fusion with another cell.

Motile

Capable of movement.