A Partnership Began Its First Year of Operations with the Following

question 24

Multiple Choice

A partnership began its first year of operations with the following capital balances: 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 to Young, Eaton, and Thurman, respectively.
Each partner withdrew $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.
What was the balance in Young's Capital account at the end of the first year?

• A) $120,900.
• B) $118,300.
• C) $126,100.
• D) $80,600.
• E) $111,500.

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Definitions:

Conscientiousness

A personality trait marked by diligence, carefulness, thoroughness, self-discipline, and the desire to do a task well.

Agreeableness

Refers to the tendency of an individual to be pleasant, accommodating, and willing to avoid conflict in their interactions with others.

Extraverted

Describes individuals who are outgoing, socially confident, and derive energy from interacting with others.

Epigenetics

the study of heritable changes in gene expression that occur without altering the DNA sequence, influenced by environmental factors and life experiences.