Austin Invests $80,000 for a 20 Percent Interest in a Partnership

question 133

Multiple Choice

Austin invests $80,000 for a 20 percent interest in a partnership that has capital totaling $300,000 after admitting Austin.Which of the following is true?

• A)The original partners received a bonus of $20,000.
• B)Austin received a bonus of $20,000.
• C)Austin's capital is $80,000.
• D)The original partners' capital in the business was $240,000 before admitting Austin.

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Definitions:

Interest Rates

The cost of borrowing money or the return on invested funds, typically expressed as a percentage of the principal.

Socialize Gains

Socialize Gains refers to the practice where benefits or profits, typically from a business or economic activity, are distributed among a wider community or society rather than being concentrated with private individuals or entities.

Privatize Losses

The practice of shifting financial losses from a private company to the public or government, typically through bailouts or subsidies.

Debt Crisis

A situation in which a country, organization, or individual cannot meet its financial obligations due to high levels of debt, leading to severe economic challenges.