-Refer to the above information.Which statement below is correct if a new partner purchases an interest in capital directly from the old partners?
A)C

Question

-Refer to the above information.Which statement below is correct if a new partner purchases an interest in capital directly from the old partners?
A)C < D 
B)C = D 
C)C = D and B = A 
D)C < D and B = A

Quizplus · Accepted Answer

When a new partner purchases an interest in capital directly from the old partners, the capital of the partnership remains unchanged because the transaction is between the individual partners themselves, not involving the partnership's capital account. Therefore, the capital before the transaction (C) equals the capital after the transaction (D).

-Refer to the Above Information