At year-end, the Circle City partnership has the following capital balances: Manning, Capital $350,000 Gonzalez, Capital 330,000 Clark, Capital 300,000 Freeney, Capital 290,000 Profits and losses are split on a 3:3:2:2 basis, respectively. Clark decides to leave the partnership and is paid $330,000 from the business based on the original contractual agreement. The payment made to Clark beyond his capital account was for Clark's share of previously unrecognized goodwill. After recognizing partnership goodwill, what is Manning’s capital balance after Clark withdraws? a. $359,000 b. $372,500 c. $380,000 d. $395,000
At year-end, the Circle City partnership has the following capital balances: Manning, Capital $350,000 Gonzalez, Capital 330,000 Clark, Capital 300,000 Freeney, Capital 290,000 Profits and losses are split on a 3:3:2:2 basis, respectively. Clark decides to leave the partnership and is paid $330,000 from the business based on the original contractual agreement. The payment made to Clark beyond his capital account was for Clark's share of previously unrecognized goodwill. After recognizing partnership goodwill, what is Manning’s capital balance after Clark withdraws? a. $359,000 b. $372,500 c. $380,000 d. $395,000
Chapter4: Gross Income: Concepts And Inclusions
Section: Chapter Questions
Problem 43P
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At year-end, the Circle City
Manning, Capital | $350,000 |
Gonzalez, Capital | 330,000 |
Clark, Capital | 300,000 |
Freeney, Capital | 290,000 |
The payment made to Clark beyond his capital account was for Clark's share of previously unrecognized
a. $359,000
b. $372,500
c. $380,000
d. $395,000
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