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Bobbi and Stuart are partners. Bobbi's capital balance is $40,000 and Stuart's capital balance is $70,000. Bobbi sells her interest in the partnership to John

Bobbi and Stuart are partners. Bobbi's capital balance is $40,000 and Stuart's capital balance is $70,000. Bobbi sells her interest in the partnership to John for $50,000. The journal entry to record the admission of John as a new partner would include:

A) A credit to John's capital account for $40,000

B) A credit to John's capital account for $50,000

C) A credit to John's capital account for $40,000 and a credit to Stuart's capital account for $10,000

D) A credit to Stuart's capital for $10,000

Based on the following information, calculate return on equity ( round to two decimal places ).

Number of Issued Common Shares#30,000

Number of Issued Preferred Shares#100,000

Profit for the year$76,000

Average Shareholders' Equity for the year$262,300

A) 2.02

B) 0.29

C) 0.50

D) 3.45

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