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Fox, Greg, and Howe are partners with average capital balances during 20X1 of $120,000, $60,000, and $40,000, respectively. Partners receive 10% interest on their average capital balances. After deducting salaries of $30,000 to Fox and $20,000 to Howe, the residual profit or loss is divided equally. In 20X1 the partnership sustained a $33,000 loss before interest and salaries to partners. By what amount should Fox's capital account change?
A. $7,000 increase
B. $11,000 decrease
C. $35,000 decrease
D. $42,000 increase

Respuesta :

TomShelby

Answer:

A. $7,000 increase

Explanation:

-33,000

-30,000

-20,000

 -12,000

  -6,000

  -,4000  

-105,000

Distribute equally betwne partner: (35,000)

FOX:

30,000 salary + 12,000 interest - 35,000 los distribution = 7,000 increase

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