Final answer:
Total capital is the sum of the capital balances of the old partners and the actual investment of the new partner, and it should always equal the new partnership capital. This concept is applicable in the field of business and is commonly used in partnerships and financial accounting.
Step-by-step explanation:
The subject of this question is Business.
Total capital is the sum of the capital balances of the old partners and the actual investment of the new partner, and it should always equal the new partnership capital. This concept is applicable in the field of business and is commonly used in partnerships and financial accounting.
For example, let's say there are two old partners in a business with capital balances of $10,000 each, and a new partner joins with an actual investment of $5,000. In this case, the total capital of the partnership would be $25,000, which is the sum of the old partners' capital balances ($20,000) and the new partner's investment ($5,000).