Which of the following statements best describes the effect of the assignment of an interest in a general partnership?
A. The assignee becomes a partner.
B. The assignee is responsible for a proportionate share of past and future partnership debts.
C. The assignment automatically dissolves the partnership.
D. The assignment transfers the assignor's interest in partnership profits and losses and the right to distributions.
Answer: D. The assignment transfers the assignor's interest in partnership profits and losses and the right to distributions.
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Meale Company makes a household appliance with model number X500. The goal for 2015 is to reduce direct materials usage per unit. No defective units are currently produced. Manufacturing conversion costs depend on production capacity defined in terms of X500 units that can be produced. The industry market size for appliances increased 10% from 2014 to 2015. The following additional data are available for 2014 and 2015: 2014 2015 Units of X500 produced and sold 10,000 11,000 Selling price $100 $95 Direct materials (square feet) 30,000 29,000 Direct material costs per square foot $10 $11 Manufacturing capacity for X500 (units) 12,500 12,000 Total conversion costs $250,000 $240,000 Conversion costs per unit of capacity $20 $20 A) $450,000 B) $1,000,000 C) $750,000 D) $700,000
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