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20. (TCO 5) Kahn and Penny are partners with capital balances of $60,000 and $20,000, respectively. Profits and losses are divided in the ratio of
20. (TCO 5) Kahn and Penny are partners with capital balances of $60,000 and $20,000, respectively. Profits and losses are divided in the ratio of 60:40. Kahn and Penny decided to form a new partnership with George, who invested land valued at $15,000 for a 20% capital interest in the new partnership. George's cost of the land was $12,000. The partnership elected to use the bonus method to record the admission of George into the partnership. George's capital account should be credited for (Points : 5) |
a. $12,000. b. .$15,000. c. $16,000. d. $19,000.
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