REFERENCE: Ref.14_02 a Partnership Began Its First Year of Operations with the with the Following

question 35

Multiple Choice

REFERENCE: Ref.14_02
A partnership began its first year of operations with the following capital balances:
Young,Capital: $143,000
Eaton,Capital: $104,000
Thurman,Capital: $143,000
The Articles of Partnership stipulated that profits and losses be assigned in the following manner:
Young was to be awarded an annual salary of $26,000 with $13,000 salary assigned to Thurman.
Each partner was to be attributed with interest equal to 10% of the capital balance as of the first day of the year.
The remainder was to be assigned on a 5:2:3 basis,respectively.
Each partner was allowed to withdraw up to $13,000 per year.
Assume that the net loss for the first year of operations was $26,000 with net income of $52,000 in the second year.Assume further that each partner withdrew the maximum amount from the business each year.
-What was Young's share of income or loss for the first year?

• A)$3,900 loss.
• B)$11,700 loss.
• C)$10,400 loss.
• D)$24,700 loss.
• E)$9,100 loss.

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Definitions:

Echoes

The sounds reflected back to the source by an obstruction, helping in determining the location of objects through echolocation or used in diagnostic tools like ultrasounds.

Barium Enema

A diagnostic imaging procedure that involves filling the colon with a barium solution to improve the visibility of the large intestine on X-rays.

Intravenous Pyelogram

A radiographic imaging technique used to visualize the kidneys, ureters, and bladder using a contrast medium injected into the veins.

Preparation

Preparation involves the process of making something ready for use or consideration, often by gathering materials or information beforehand.