Barber and Atkins are partners in an accounting firm and share net income and loss equally.Barber's beginning partnership capital balance for the current year is $285,000,and Atkins' beginning partnership capital balance for the current year is $370,000.The partnership had net income of $250,000 for the year.Barber withdrew $90,000 during the year and Atkins withdrew $100,000.What is Barber's return on equity?
A)41.3%
B)43.9%
C)32.7%
D)33.8%
E)36.5%

Question

Quizplus · Accepted Answer

Barber's average capital balance for the year is ($285,000 + $285,000 + $90,000) / 2 = $330,000. His return on equity is $125,000 / $330,000 = 41.3%.

Barber and Atkins Are Partners in an Accounting Firm and Share