The inexperienced accountant for Fox, Gee & Hay LLP prepared the following journal entries during the fiscal

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The inexperienced accountant for Fox, Gee & Hay LLP prepared the following journal entries during the fiscal year ended August 31, 2005:

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Prepare journal entries for Fox, Gee & Hay LLP on August 31, 2005, to correct the accounting records, which have not been closed for the year ended August 31, 2005. Assume that Hay’s admission to the partnership should have been recorded by the bonus method.
Do not reverse the foregoing journal entries.

Prepare journal entries for Fox, Gee & Hay LLP on August 31, 2005, to correct the accounting records, which have not been closed for the year ended August 31, 2005. Assume that Hay’s admission to the partnership should have been recorded by the bonus method.
Do not reverse the foregoing journal entries.

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King decided to retire from the partnership on June 30, 2005, and by mutual agreement of the partners the plant assets were adjusted to their total current fair value of $260,000. The partnership paid $92,000 cash for King’s equity in the partnership, exclusive of the loan, which was repaid in full. No goodwill was to be recognized in this transaction.
Prepare journal entries for King, Lowe & More LLP on June 30, 2005, to record the adjustment of plant assets to current fair value and King’s retirement.

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