A partner has a capital balance of $40,000 for five months, $50,000 for four months, and $60,000 for three months. The average capital balance is

Question

Quizplus · Accepted Answer

To find the average capital balance, we need to add up the total capital for each partner and divide it by the total number of months they have had that capital.

For Partner A: 
$40,000 x 5 = $200,000 
$50,000 x 4 = $200,000 
$60,000 x 3 = $180,000

Total Capital = $580,000 
Total Months = 5 + 4 + 3 = 12

Average Capital Balance = Total Capital / Total Months 
= $580,000 / 12 
= $48,333.33

Therefore, the best choice is D, $48,333.

A Partner Has a Capital Balance of $40,000 for Five