Farrell and Jimmy Enter into a Partnership Agreement on May

question 49

Multiple Choice

Farrell and Jimmy enter into a partnership agreement on May 1,2017.Farrell contributes $50,000 and Jimmy contributes $140,000 as their capital contributions.They decide to share profits and losses in the ratio of their respective capital account balances.The net income for the year ended December 31,2017 is $60,000.Which of the following is the correct journal entry to record the allocation of profit?

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Definitions:

Fractions

Represents parts of a whole or a collection, expressed with different numbers on the top (numerator) and bottom (denominator) of a slash or line.

Whole Numbers

Non-negative integers, including zero, without any fractional or decimal parts.

Fractions

A mathematical expression representing the division of one quantity by another, typically written with a numerator above a denominator.

Lowest Terms

A fraction reduced to the lowest possible terms while retaining its original value.