Fred and Ralph are partners who share profits and losses in the ratio of 7:3, respectively. Their respective capital accounts are as follows:

They agreed to admit Lute as a partner with a one-third interest in the capital and profits and losses upon an investment of $25,000. The new partnership will begin with total capital of $90,000. Immediately after Lute’s admission, what are the capital balances of Fred, Ralph, and Lute, respectively?

a. $30,000, $30,000, $30,000

b. $31,500, $28,500, $30,000

c. $31,667, $28,333, $30,000

d. $35,000, $30,000, $25,000

Transcribed Image Text:

Fred $35,000 Ralph 30,000