Chase and Hatch Are Partners and Share Equally in Income

question 23

Multiple Choice

Chase and Hatch are partners and share equally in income or loss. Chase's current capital balance is $135,000 and Hatch's is $120,000. Chase and Hatch agree to accept Flax with a 30% interest in the partnership. Flax invests $115,000 in the partnership. The amount credited to Flax's capital account is:

• A) $111,000.
• B) $115,000.
• C) $92,500.
• D) $120,000.
• E) $119,000.