Question

# The following information is available on TGR Enterprises, a partnership, for the most recent fiscal year:...

The following information is available on TGR Enterprises, a partnership, for the most recent fiscal year:

 Total partnership capital at beginning of the year \$ 201,000 Partnership net income for the year \$ 171,000 Withdrawals by partners during the year \$ 99,000 Additional investments by partners during the year \$ 81,000

There are three partners in TGR Enterprises: Tracey, Gregory and Rodgers. At the end of the year, the partners' capital accounts were in the ratio of 2:1:2, respectively. Compute the ending capital balances of the three partners.

Multiple Choice

Tracey = \$99,400; Gregory = \$110,400; Rodgers = \$99,400.

Tracey = \$141,600; Gregory = \$70,800; Rodgers = \$141,600.

Tracey = \$220,800; Gregory = \$110,400; Rodgers = \$220,800.

Tracey = \$68,400; Gregory = \$34,200; Rodgers = \$68,400.

Tracey = \$118,000; Gregory = \$118,000; Rodgers = \$118,000.

Solution:

From the given data we need to find the partner's capital accounts were in the ratio of 2:1:2, at the end of the year,

 Details Amount(\$) Total partnership capital at beginning of the year \$201,000 Add: Partnership net income for the year \$171,000 Add: Additional investments by partners during the year \$81,000 \$453,000 Less: Withdrawals by partners during the year (\$99,000) Ending partnership capital \$354,000

The partner's capital accounts were in the ratio of 2:1:2, at the end of the year,

Tracey =  \$354,000*2/5 = \$141,600.

Gregory =  \$354,000*1/5 = \$70,800.

Rodgers = \$354,000*2/5 = \$141,600.

So, the correct option is (b). Tracey = \$141,600; Gregory = \$70,800; Rodgers = \$141,600.

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