The following information is available on TGR Enterprises,a partnership,for the most recent fiscal year:
$\begin{array}{ll}
\text { Total partnership capital at beginning of the year } & \$ 180,000 \
\text { Partnership net income for the year } & \$ 150,000 \
\text { Withdrawals by partners during the year } & \$ 120,000 \
\text { Additional investments by partners during the year } & \$ 60,000
\end{array}$

There are three partners in TGR Enterprises: Tracey,Gregory and Rodgers.At the end of the year,the partners' capital accounts were in the ratio of 2:1:2,respectively.Compute the ending capital balances of the three partners.

Question

The following information is available on TGR Enterprises,a partnership,for the most recent fiscal year:
$\begin{array}{ll}
\text { Total partnership capital at beginning of the year } & \$ 180,000 \
\text { Partnership net income for the year } & \$ 150,000 \
\text { Withdrawals by partners during the year } & \$ 120,000 \
\text { Additional investments by partners during the year } & \$ 60,000
\end{array}$

There are three partners in TGR Enterprises: Tracey,Gregory and Rodgers.At the end of the year,the partners' capital accounts were in the ratio of 2:1:2,respectively.Compute the ending capital balances of the three partners.

Quizplus · Accepted Answer

To find the ending capital balances, first calculate the total capital at the end of the year. Start with the beginning capital ($180,000), add net income ($150,000), add additional investments ($60,000), and subtract withdrawals ($120,000). This gives a total ending capital of $270,000. The ratio of the partners' capital accounts is 2:1:2, which means the total parts are 5 (2+1+2). Each part is therefore $270,000 / 5 = $54,000. Tracey and Rodgers each have 2 parts, so $54,000 * 2 = $108,000 each, and Gregory has 1 part, so $54,000. This matches option A.

The Following Information Is Available on TGR Enterprises,a Partnership,for the Most