Assume that the capital of an existing partnership is $90,000 and all existing assets reflect fair market values. If an incoming partner acquires a 40% interest in the partnership for $55,000, the bonus traceable to the incoming partner is

Question

Quizplus · Accepted Answer

New Partnership Capital = 90,000 + 55,000 = $145,000
New Partner Capital = 40% F1F1F1S1F1F1F10 145,000 = 58,000
Bonus to the new partner = 55,000 - 58,000 = 3,000

Assume That the Capital of an Existing Partnership Is $90,000