Question

1. Tomas and Saturn are partners who share income in the ratio of 3:1. Their capital balances are $93,600 and $91,300, respectively. The partnership generated net income of $41,400. What is Tomas's capital balance after closing the revenue and expense accounts to the capital accounts?

a.$139,390

b.$124,650

c.$119,172

d.$130,463

2. Tomas and Saturn are partners who share income in the ratio of 3:1. Their capital balances are $80,000 and $120,000, respectively. The partnership generated net income of $30,000. What is Tomas's capital balance after closing the revenue and expense accounts to the capital accounts?

a.$22,500

b.$102,500

c.$127,500

d.$57,500

3. Hannah Johnson contributed equipment, inventory, and $43,900 cash to a partnership. The equipment had a book value of $29,000 and a market value of $34,200. The inventory had a book value of $47,300 but only had a market value of $19,400 due to obsolescence. The partnership also assumed a $15,000 note payable owed by Hannah that was originally used to purchase the equipment.

What amount should be recorded to Hannah's capital account?

a.$125,400

b.$105,200

c.$82,500

d.$112,500

4. Henry Jones contributed equipment, inventory, and $44,000 cash to a partnership. The equipment had a book value of $35,000 and market value of $28,000. The inventory had a book value of $25,000 but only had a market value of $12,000 due to obsolescence. The partnership also assumed a $15,000 note payable owed by Henry that was originally used to purchase the equipment.

What amount should be recorded to Henry's capital account?

a.$69,000

b.$84,000

c.$104,000

d.$89,000

5. Sandra and Kelsey are forming a partnership. Sandra will invest a piece of equipment with a book value of $7,500 and a fair market value of $18,000. Kelsey will invest a building with a book value of $40,000 and a fair market value of $44,000.

What amount will be recorded to Sandra's capital account?

a.$7,500

b.$18,000

c.$10,500

d.$25,500

Answer 1

1. (b) $124,650

Tomas's capital = $93,600 + ($41,400 x 3/4) = $124,650

2. (b) $102,500

Tomas's capital = $80,000 + ($30,000 x 3/4) = $102,500

3. (c) $82,500

Hannah's capital account = $43,900 + $34,200 + $19,400 - $15,000 = $82,500

4. (a) $69,000

Henry's capital account = $44,000 + $28,000 + $12,000 - $15,000 = $69,000

5. (b) $18,000

Sandra's capital account = $18,000 fair market value of equipment will be recorded

"It would be appreciated if you give your feedback"