When a partner invests in a business, he/she expects to get return on his equity in the business. The major reason for this is to compare his/her return in the partnership business with the return he/she could get elsewhere.

The return on partner equity is calculated by dividing his/her net income from the partnership business by his/her average capital for the period.

The formula is given below:

Net income x 100

Average capital

Average capital = Opening capital balance + Closing capital balance

For Carter Pearson, the average capital is = $55,500 + $62,500

= $59,000

The return on equity will be: $5,750 x 100

$59,000

= 9.7457

= 9.75% - approximate to two decimal point.

5 0

3 years ago

For the month of September, Florida, Inc., incurs a direct materials cost of $12,000 for 7,500 gallons of strawberry lemonade pr

Ludmilka [50]

Answer:

$0.10 is the correct answer.

Explanation:

8 0

2 years ago

Under what circumstances might a business plan include a funding request for working capital? Select one: a. It is just starting

cestrela7 [59]

A. It is just starting out.

8 0

3 years ago

Earnings on an IRA grow until

frez [133]

Earnings on an IRA grow until C. you take the money out.

An IRA will continue to earn interest and gain value until your money is taken out of the account. Once the money is taken out, the interest will stop being earned. An IRA is a good savings plan to invest your money into for potential gain. There are low and high risks with investments but IRA's are pretty easy to navigate for first time investors.

3 0

2 years ago