Wallace,Simpson,and Prince Are Partners and Share Income and Losses in a 3:4:3

Multiple Choice

Wallace,Simpson,and Prince are partners and share income and losses in a 3:4:3 ratio.The partnership's capital balances are Wallace,$68,000;Simpson,$90,000;and Prince,$42,000.Royal is admitted to the partnership on July 1 with a 20% equity and invests $50,000.The partnership would record the admission of Royal into the partnership as:

A) Debit Wallace,Capital $15,000;debit Simpson,Capital,$20,000;debit Prince,Capital $15,000;credit Royal,Capital $50,000.
B) Debit Cash $20,000;credit Prince,Capital $20,000.
C) Debit Cash $40,000;debit Wallace,Capital $3,000;debit Simpson,Capital,$4,000;debit Prince,Capital $3,000;credit Royal,Capital $50,000.
D) Debit Cash $50,000;credit Royal,Capital $50,000.
E) Debit Cash $50,000;credit Simpson,Capital $10,000,credit Royal,Capital $40,000.