R. Schoen purchases a 25% interest for $60000 when the Hise Poole Lagos partnership has total capital of $540000. Prior to the admission of Schoen each partner has a capital balance of $180000. Each partner relinquishes an equal amount of his capital balance to Schoen. The amount to be relinquished by Lagos is

A) $30000.
B) $38000.
C) $45000.
D) $75000.

Question

emma claire fakier · Accepted Answer

Final Answer : A, Explanation :  Lagos relinquishes $30,000, which is one-third of the $90,000 total relinquished by the existing partners to accommodate Schoen's $60,000 investment for a 25% interest, with the remaining $30,000 representing Schoen's share of the partnership's existing value.

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