The following information is available regarding Grace Smit's capital account in Enterprise Consulting Group,a general partnership,for a recent year:
$$\begin{array} { l l }
\text { Beginning of the year balance } & \$ 22,000 \
\text { Share of partrership income } & \$ 8,500 \
\text { Withdrawals made during the year } & \$ 6,000
\end{array}$$
What is Smit's partner return on equity during the year in question?

Question

The following information is available regarding Grace Smit's capital account in Enterprise Consulting Group,a general partnership,for a recent year:
$$\begin{array} { l l } 
\text { Beginning of the year balance } & \$ 22,000 \
\text { Share of partrership income } & \$ 8,500 \
\text { Withdrawals made during the year } & \$ 6,000
\end{array}$$
What is Smit's partner return on equity during the year in question?

Quizplus · Accepted Answer

Smit's partner return on equity is calculated as follows:Partner return on equity = (Share of partnership income - Withdrawals) / Beginning of the year balance= (8,500 - 6,000) / 22,000= 2,500 / 22,000= 0.1136= 11.36%

The Following Information Is Available Regarding Grace Smit's Capital Account