Question

Maxwell and Smart are forming a partnership. Maxwell is investing a building that has a market value of $100,000. However, the building carries a $36,000 mortgage that will be assumed by the partnership. Smart is investing $61,000 cash. The balance of Maxwell's Capital account will be:

Answer 1

Answer:

=$64,000

Explanation:

Max and Smart are forming partnership

Market Value of building = 100,000

The building carried mortgage by the partnership= 36,000

Smart is investing= 61,000

Balance of Maxwell capital Account will be Building value - Mortgage on building

=$100,000 - $36,000

=$64,000

Balance of Maxwell capital Account is equals to =$64,000

Capital account is the account that show the net worth of an enterprise or business in accounting.