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A partnership begins its first year with the following capital balances: Alfred, Capital $ 32,000 Bernard, Capital 42,000 Collins, Capital 52,000 The articles of partnership
A partnership begins its first year with the following capital balances:
Alfred, Capital | $ | 32,000 |
Bernard, Capital | 42,000 | |
Collins, Capital | 52,000 | |
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.
- Bernard is allocated compensation of $12,000 per year.
- Any remaining profits and losses are allocated on a 3:3:4 basis, respectively.
- Each partner is allowed to withdraw up to $4,000 cash per year.
Assuming that the net income is $42,000 and that each partner withdraws the maximum amount allowed, what is the balance in Collins capital account at the end of that year?
Multiple Choice
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$60,096
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$53,364
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$64,096
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$55,120
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