Table 12-7 Bill, Bob, and Bo, Are Partners in the Trendy Company

question 18

Multiple Choice

Table 12-7
Bill, Bob, and Bo, are partners in the Trendy Company, a retailer of inexpensive kids' wear. They share profits and losses in a 1:4:5 ratio and have decided to expand their business territory. They have agreed to admit Burt to the partnership for a cash investment. Their capital balances are currently $60,000, $100,000, and $140,000, respectively.
-Refer to Table 12-7.Burt has been offered a 25% interest in the firm for $60,000 cash investment.Assuming Burt takes the offer,the entry to record his investment in the partnership includes a:

• A) debit to Cash for $75,000
• B) debit to loss on sale of partnership interest for $46,000
• C) credit to Bill, Capital for $1,500
• D) debit to Bob, Capital for $12,000

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Definitions:

Ecchymosis

The medical term for a subcutaneous purplish patch larger than a petechia, commonly called a bruise, caused by bleeding under the skin.

Abdominal Mass

A lump felt in the abdomen that may be caused by a variety of medical conditions, ranging from benign cysts to cancers.

Cardiac Muscle Fibers

Specialized muscle fibers in the heart that are responsible for the heart's contraction and pumping action.

Striations

Parallel lines or grooves on a surface, often seen in muscle fibers and certain types of rocks, indicative of specific structural or formation processes.