A local partnership has two partners, Jim and Pam. Jim has a capital balance of $150,000 and Pam has a capital balance of $125,000. These two partners share profits and losses 60 percent (Jim) and 40 percent (Pam). Cece invests $75,000 in cash in the partnership for a 25 percent ownership. The bonus method will be used. What is Cece’s capital balance after this new investment?

a. 120000

b. 130000

c. 87500

d. 142500

e. 157500

Answer rating: 100% (QA)

Total capital of partnership after admission of Cece 15000... View the full answer