Abby and Bailey are partners who share income in the ratio of 2:1 and have capital balances of $68,100 and $28,200, respectively. With the consent of Bailey, Sandra buys one-half of Abby's interest for $40,900. For what amount will Abby's capital account be debited to record admission of Sandra to the partnership?

a.$34,050

b.$28,200

c.$68,100

d.$40,900

a.$34,050

Explanation:

In the question, it is mentioned that the capital balances of Abby and Bailey are $68,100 and $28,200 respectively. And, the Sandra buys one half of Abby interest which equals to

= Abby capital balance * half-percentage

= $68,100 * 50%

= $34,050

The amount which is given for buying Abby interest i. e $40,900 is not relevant. Hence, it is ignored