Question

Maxwell and Smart are forming a partnership. Maxwell is investing a building that has a market value of $180,000. However, the building carries a $56,000 mortgage that will be assumed by the partnership. Smart is investing $120,000 cash. The balance of Maxwell's Capital account will be:_________

A. $180,000.
B. $124,000.
C. $56,000.
D. $64,000.
E. $60,000.

Answer 1

Answer:$124,000

Step-by-step explanation:

Answer 2

B. $124,000

Step-by-step explanation:

The balance for Maxwell's capital account will be $124,000 i.e the total Market value of the building he is investing minus the mortgage that is supposed to be paid by the partnership.

$180,000 - $ 56,000 = $124,000