Ben White and Lisa Caputi are partners,and each has a capital balance of $75,000.To gain admission to the partnership,Tim Smith pays $50,000 directly to White for one-half of his equity.After the admission of Smith,the total partners' equity in the records of the partnership will be
A) $150,000.
B) $130,000.
C) $125,000.
D) $100,000.

Question

Quizplus · Accepted Answer

The total partners' equity remains unchanged at $150,000 because Tim Smith's payment is made directly to Ben White and does not affect the partnership's total equity.

Ben White and Lisa Caputi Are Partners,and Each Has a Capital