The partners of Bentsen & Cole LLP had capital account balances of $45,000 and $25,000, respectively. They shared net income and losses in a 3:1 ratio.
Prepare journal entries to record the admission of Diaz to the limited liability partnership under the (1) bonus method, and (2) goodwill method for each of the following assumptions:
a. Diaz invested a single proprietorship with identifiable assets having a current fair value of $40,000 and liabilities having a current fair value of $10,000 for a 25% interest in the net assets of the partnership.
b. Diaz invested a single proprietorship with identifiable assets having a current fair value of $40,000 and liabilities having a current fair value of $10,000 for a
33 1/3% interest in the net assets of the partnership.

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The Answer of The partners of Bentsen & Cole LLP had capital account balances of $45,000 and $25,000, respectively. They shared net income and losses in a 3:1 ratio.
Prepare journal entries to record the admission of Diaz to the limited liability partnership under the (1) bonus method, and (2) goodwill method for each of the following assumptions:
a. Diaz invested a single proprietorship with identifiable assets having a current fair value of $40,000 and liabilities having a current fair value of $10,000 for a 25% interest in the net assets of the partnership.
b. Diaz invested a single proprietorship with identifiable assets having a current fair value of $40,000 and liabilities having a current fair value of $10,000 for a
33 1/3% interest in the net assets of the partnership.

The Partners of Bentsen & Cole LLP Had Capital Account