Pia and Ramona are partners who share income in the ratio of 3:2. Their capital balances are $90,000 and $130,000 respectively. Income Summary has a credit balance of $40,000. What is Ramona's capital balance after closing Income Summary to Capital?

Question

Quizplus · Accepted Answer

First, we need to find the total income earned by Pia and Ramona:
Total Income = Capital + Income Summary
Total Income = ($90,000 + $130,000) + $40,000
Total Income = $260,000

Now, we can find the amount of income earned by each partner:
Pia's Income = (3/5) x $260,000 = $156,000
Ramona's Income = (2/5) x $260,000 = $104,000

To close Income Summary to Capital, we need to add each partner's income to their capital balance:
Pia's Final Capital Balance = $90,000 + $156,000 = $246,000
Ramona's Final Capital Balance = $130,000 + $104,000 = $234,000

Therefore, the answer is B, $146,000, which is Ramona's final capital balance after closing Income Summary to Capital.

Pia and Ramona Are Partners Who Share Income in the Ratio