what is the balance in Coloma's capital account at the end of the year?
Chapter15: Partnership Accounting
Section: Chapter Questions
Problem 1PA: The partnership of Tatum and Brook shares profits and losses in a 60:40 ratio respectively after...
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Transcribed Image Text:A partnership begins its first year with the following capital balances:
Alexander, Capital
Bertrand, Capital
Coloma, Capital
The articles of partnership stipulate that profits and losses be assigned in the following manner:
• Each partner is allocated interest equal to 6 percent of the beginning capital balance.
• Bertrand is allocated compensation of $18,000 per year.
• Any remaining profits and losses are allocated on a 3:3:4 basis, respectively.
• Each partner is allowed to withdraw up to $3,000 cash per year.
$ 62,000
72,000
82,000
Assuming that the net income is $72,000 and that each partner withdraws the maximum amount allowed, what is the balance in Coloma's capital account at the end of the year?
Multiple Choice
$103,336
$86,920
$100,336
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