Mace and Bowen are partners and share equally in income or loss.Mace's current capital balance is $135,000 and Bowen's is $120,000.Mace and Bowen agree to accept Kent with a 30% interest in the partnership.Kent invests $115,000 in the partnership.The amount credited to Kent's capital account is:
A)$111,000.
B)$115,000.
C)$92,500.
D)$120,000.
E)$119,000.

Question

Quizplus · Accepted Answer

Kent's capital account is credited with $111,000 because the total capital after Kent's investment is $370,000 ($135,000 + $120,000 + $115,000). Kent's 30% interest means his capital should be 30% of $370,000, which is $111,000.

Mace and Bowen Are Partners and Share Equally in Income