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Gary,Peter,and Chris Own a Firm as Partners

question 149

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Gary,Peter,and Chris own a firm as partners.Gary has a capital balance of $22,000; Peter a capital balance of $42,000; and Chris has a capital balance of $32,000.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 $22,000?


Definitions:

Gross Profit

The financial gain made after subtracting the cost of goods sold from the total sales revenue.

Net Sales

Net sales is the revenue from sales of goods or services after subtracting returns, allowances for damaged or missing goods, and discounts.

Inventory Available

The total quantity of goods a company has on hand for sale at any given time, including both finished goods and goods in production.

Current Asset

Assets that are expected to be converted into cash, sold, or consumed within one year or within the company’s normal operating cycle if longer.

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