,A,B, and C have a partnership.Their capital balances are $100,000, $140,000, and $60,000 respectively.The agreed profit and loss ratios are 30/40/30.They are considering admitting a new partner D.The net assets of the partnership are worth $360,000.D is willingly to invest $60,000 plus assets with a book value of $24,000 and a fair market value of $40,000.
Instructions:
Provide journal entries assuming
1.D is receiving a 20% share of the new partnership with his investment.His admission is to be recorded using the bonus method
2.D is receiving a 20% share of the new partnership with his investment.His admission is to be recorded using the goodwill method.
1.D is receiving a 30% share of the new partnership with his investment.His admission is to be recorded using the bonus method.\
2.D is receiving a 25% share of the new partnership with his investment.His admission is to be recorded using the goodwill method.\

Question

Quizplus · Accepted Answer

The Answer of ,A,B, and C have a partnership.Their capital balances are $100,000, $140,000, and $60,000 respectively.The agreed profit and loss ratios are 30/40/30.They are considering admitting a new partner D.The net assets of the partnership are worth $360,000.D is willingly to invest $60,000 plus assets with a book value of $24,000 and a fair market value of $40,000.
Instructions:
Provide journal entries assuming
1.D is receiving a 20% share of the new partnership with his investment.His admission is to be recorded using the bonus method
2.D is receiving a 20% share of the new partnership with his investment.His admission is to be recorded using the goodwill method.
1.D is receiving a 30% share of the new partnership with his investment.His admission is to be recorded using the bonus method.\
2.D is receiving a 25% share of the new partnership with his investment.His admission is to be recorded using the goodwill method.\

,A,B, and C Have a Partnership