On November 30,

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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On November 30, capital balances are Gary $307000, Ellis $258000 and Gise $258000. The income ratios are 25%, 25% and 50%,
respectively. Gary decides to retire from the partnership. In order for Ellis and Gise to have equal capital interests after the retirement of
Gary, how much partnership cash would have to be paid to Gary for her partnership interest?
○ $0
○ $272889
○ Any amount paid to Gary will cause Ellis and Gise to still have equal capital balances
○ $307000
Transcribed Image Text:On November 30, capital balances are Gary $307000, Ellis $258000 and Gise $258000. The income ratios are 25%, 25% and 50%, respectively. Gary decides to retire from the partnership. In order for Ellis and Gise to have equal capital interests after the retirement of Gary, how much partnership cash would have to be paid to Gary for her partnership interest? ○ $0 ○ $272889 ○ Any amount paid to Gary will cause Ellis and Gise to still have equal capital balances ○ $307000
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