What will be balance in partner a capital account

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Problem 1: Partner A and Partner B have capital balances of $40,000 and $60,000, respectively, prior to the admission of Partner C. Partner C contributes $20,000 in exchange for a 20% interest in the partnership. The partnership agreement stipulates profits and losses are shared equally. What will be the balance in Partner A's capital account after the admission of Partner C?

Option 1: $40,000
Option 2: $38,000
Option 3: $42,000
Option 4: $50,000

Reference no: EM132954484

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