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Abbott and Baker form a partnership with each partner contributing $50,000 cash. Abbott will have more to do with the day-to-day operations of the partnership so the partnership agreement calls for Abbott to get 80% of the partnership's earnings. During the first year of operations, the company earned $45,000 revenue and incurred and paid $25,000 of expenses. Each partner withdrew $2,000 at the end of Year 1. What is the value of Baker's Capital account on the Year 1 Balance Sheet? O $58,000 $54,000 O $52,000 $50.000

Abbott and Baker form a partnership with each partner contributing $50,000 cash. Abbott will have more to do with the day-to-day operations of the partnership so the partnership agreement calls for Abbott to get 80% of the partnership's earnings. During the first year of operations, the company earned $45,000 revenue and incurred and paid $25,000 of expenses. Each partner withdrew $2,000 at the end of Year 1. What is the value of Baker's Capital account on the Year 1 Balance Sheet? O $58,000 $54,000 O $52,000 $50.000

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Abbott and Baker form a partnership with each partner contributing $50,000 cash. Abbott will have more to do with the day-to-day operations of the partnership so the partnership agreement calls for Abbott to get 80% of the partnership's earnings. During the first year of operations, the company earned $45,000 revenue and incurred and paid $25,000 of expenses. Each partner withdrew $2,000 at the end of Year 1. What is the value of Baker's Capital account on the Year 1 Balance Sheet? $58,000 O $54,000 $52,000 $50,000
Transcribed Image Text:Abbott and Baker form a partnership with each partner contributing $50,000 cash. Abbott will have more to do with the day-to-day operations of the partnership so the partnership agreement calls for Abbott to get 80% of the partnership's earnings. During the first year of operations, the company earned $45,000 revenue and incurred and paid $25,000 of expenses. Each partner withdrew $2,000 at the end of Year 1. What is the value of Baker's Capital account on the Year 1 Balance Sheet? $58,000 O $54,000 $52,000 $50,000
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