On November 30 capital balances are Ross $300000 Ellis $250000 and Gise $250000. The income ratios are 20% 20% and 60% respectively. Ross decides to retire from the partnership. In order for Ellis and Gise to have equal capital interests after the retirement of Ross how much partnership cash would have to be paid to Ross for her partnership interest?
A) $0
B) $266667
C) $300000
D) Any amount paid to Ross will cause Ellis and Gise to still have equal capital balances.
Correct Answer:
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