Web Services is organized as a limited partnership,with Wren Littlefeather as one of its partners.Wren's capital account began the year with a balance of $87,000.During the year,Wren's share of the partnership income was $60,000 and she received $25,000 in distributions from the partnership.What is Wren's partner return on equity?
A)57.42%
B)49.18%
C)68.97%
D)33.49%
E)40.23%

Question

Quizplus · Accepted Answer

Wren's partner return on equity is calculated as (Net Income - Distributions) / Beginning Capital Balance. So, (60,000 - 25,000) / 87,000 = 35,000 / 87,000 = 0.4023 or 40.23%.

Web Services Is Organized as a Limited Partnership,with Wren Littlefeather