Question : 95.Peters and Chong partners and share equally in income or : 1258242

 

95.Peters and Chong are partners and share equally in income or loss. Peters’ current capital balance is $140,000 and Chong’s is $130,000. Peters and Chong agree to accept Aaron with a 30% interest in the partnership. Aaron invests $98,000 in the partnership. The amount credited to Aaron’s capital account is:   

A.$81,000.

B.$102,600.

C.$110,400.

D.$98,000.

E.$114,533.

96.Peters, Chong, and Aaron are dissolving their partnership. Their partnership agreement allocates each partner an equal share of all income and losses. The current period’s ending capital account balances are Peters, $54,000; Chong, $42,000; and Aaron, ($2,000). After all assets are sold and liabilities are paid, there is $94,000 in cash to be distributed. Aaron is unable to pay the deficiency. The journal entry to record the distribution should be:    

A.Debit Peters, Capital $54,000; debit Chong, Capital $40,000; credit Cash $94,000.

B.Debit Peters, Capital $54,000; debit Chong, Capital $42,000; credit Cash $96,000.

C.Debit Peters, Capital $53,000; debit Chong, Capital $41,000; credit Cash $94,000.

D.Debit Cash $94,000; debit Aaron, Capital $2,000, credit Peters, Capital $54,000, credit Chong, Capital $42,000.

E.Debit Cash $94,000; credit Peters, Capital $47,000; credit Chong, Capital $47,000.

97.Barber and Atkins are partners in an accounting firm and share net income and loss equally. Barber’s beginning partnership capital balance for the current year is $285,000, and Atkins’ beginning partnership capital balance for the current year is $370,000. The partnership had net income of $250,000 for the year. Barber withdrew $90,000 during the year and Atkins withdrew $100,000. What is Barber’s ending equity?   

A.$357,500

B.$362,500

C.$445,000

D.$320,000

E.$195,000

98.Barber and Atkins are partners in an accounting firm and share net income and loss equally. Barber’s beginning partnership capital balance for the current year is $285,000, and Atkins’ beginning partnership capital balance for the current year is $370,000. The partnership had net income of $250,000 for the year. Barber withdrew $90,000 during the year and Atkins withdrew $100,000. What is Barber’s return on equity?   

A.41.3%

B.43.9%

C.32.7%

D.33.8%

E.36.5%

99.Barber and Atkins are partners in an accounting firm and share net income and loss equally. Barber’s beginning partnership capital balance for the current year is $285,000, and Atkins’ beginning partnership capital balance for the current year is $370,000. The partnership had net income of $250,000 for the year. Barber withdrew $90,000 during the year and Atkins withdrew $100,000. What is Atkins’s return on equity?   

A.41.3%

B.43.9%

C.32.7%

D.33.8%

E.36.5%

100.Fellows and Marshall are partners in an accounting firm and share net income and loss equally. Fellows’ beginning partnership capital balance for the current year is $185,000, and Marshall’s beginning partnership capital balance for the current year is $260,000. The partnership had net income of $350,000 for the year. Fellows withdrew $80,000 during the year and Marshall withdrew $70,000. What is Marshall’s return on equity?   

A.67.3%

B.60.3%

C.78.7%

D.54.3%

E.56.0%

101.If a company wants to protect its three investors against personal liability risk, which of the following business forms would not be a suitable option?   

A.C Corporation

B.S Corporation

C.Limited liability partnership

D.Partnership

E.Limited liability company

102.Reno contributed $104,000 in cash plus equipment valued at $27,000 to the RD Partnership. The journal entry to record the transaction for the partnership is:    

A.Debit Cash $104,000; debit Equipment $27,000; credit RD Partnership, Capital $131,000.

B.Debit Cash $104,000; debit Equipment $27,000; credit Common Stock $131,000.

C.Debit Cash $104,000; debit Equipment $27,000; credit Reno, Capital $131,000.

D.Debit Reno, Capital $131,000; credit RD Partnership, Capital $131,000.

E.Debit RD Partnership, Capital $131,000; credit Reno, Capital $131,000.

103.Bloom and Plant organize a partnership on January 1. Bloom’s initial investment consists of $800 cash, $1,700 equipment and a $500 note payable reflecting a bank loan for the new business. Plant’s initial investment is cash of $2,000. These amounts are the values agreed on by both partners. The journal entry to record Bloom’s investment is:    

A.Debit Cash $800; debit Equipment $1,700; credit Note Payable $500; credit Bloom, Capital $2,000.

B.Debit Cash $2,000; credit Bloom, Capital $2,000.

C.Debit Cash $800; debit Equipment $1,700; credit Bloom, Capital $2,500.

D.Debit Cash $800; debit Equipment $1,200; credit Bloom, Capital $2,000.

E.Debit Bloom, Capital $3,000; credit Common Stock $3,000.

104.Bloom and Plant organize a partnership on January 1. Bloom’s initial investment consists of $800 cash, $1,700 equipment and a $500 note payable reflecting a bank loan for the new business. Plant’s initial investment is cash of $2,000. These amounts are the values agreed on by both partners. The journal entry to record Plant’s investment is:    

A.Debit Cash $1,500; debit Note Payable $500; credit Plant, Capital $2,000.

B.Debit Cash $2,000; credit Note Payable $500, credit Plant, Capital $1,500.

C.Debit Bloom, Capital $2,000; credit Cash $2,000.

D.Debit Cash $2,500; credit Note Payable $500; credit Plant, Capital $2,500.

E.Debit Cash $2,000; credit Plant, Capital $2,000.

105.Wallace and Simpson formed a partnership with Wallace contributing $60,000 and Simpson contributing $40,000. Their partnership agreement calls for the income (loss) division to be based on the ratio of capital investments. The partnership had income of $150,000 for its first year of operation. When the Income Summary is closed, the journal entry to allocate partner income is:    

A.Debit Income Summary $150,000; credit Wallace, Capital $75,000; credit Simpson, Capital $75,000.

B.Debit Wallace, Capital $75,000; debit Simpson, Capital $75,000; credit Income Summary $150,000.

C.Debit Income Summary $150,000; credit Wallace, Capital $90,000; credit Simpson, Capital $60,000.

D.Debit Cash $150,000; credit Wallace, Capital $90,000; credit Simpson, Capital $60,000.

E.Debit Wallace, Capital $90,000; debit Simpson, Capital $60,000; credit Cash $150,000.

106.Wallace and Simpson formed a partnership with Wallace contributing $60,000 and Simpson contributing $40,000. Their partnership agreement calls for the income (loss) division to be based on the ratio of capital investments. Wallace sold one-half of his partnership interest to Prince for $55,000 when his capital balance was $78,000. The partnership would record the admission of Prince into the partnership as:    

A.Debit Wallace, Capital $55,000; credit Prince, Capital $55,000.

B.Debit Wallace, Capital $39,000; credit Prince, Capital $39,000.

C.Debit Prince, Capital $55,000; credit Wallace, Capital $55,000.

D.Debit Wallace, Capital $30,000; credit Prince, Capital $30,000.

E.Debit Wallace, Capital $39,000; debit Cash $16,000; credit Prince, Capital $55,000.

107.Wallace, Simpson, and Prince are partners and share income and losses in a 3:4:3 ratio. The partnership’s capital balances are Wallace, $68,000; Simpson, $90,000; and Prince, $42,000. Royal is admitted to the partnership on July 1 with a 20% equity and invests $50,000. The partnership would record the admission of Royal into the partnership as:    

A.Debit Wallace, Capital $15,000; debit Simpson, Capital $20,000; debit Prince, Capital $15,000; credit Royal, Capital $50,000.

B.Debit Cash $20,000; credit Prince, Capital $20,000.

C.Debit Cash $40,000; debit Wallace, Capital $3,000; debit Simpson, Capital, $4,000; debit Prince, Capital $3,000; credit Royal, Capital $50,000.

D.Debit Cash $50,000; credit Royal, Capital $50,000.

E.Debit Cash $50,000; credit Simpson, Capital $10,000; credit Royal, Capital $40,000.