Question
ABC Partnership has the following capital account balances and income sharing ratios. Aspen 120,000 35% Brown 75,000 45% Carter 225,000 20% Denver contributes $150,000 to
ABC Partnership has the following capital account balances and income sharing ratios.
| Aspen | 120,000 | 35% |
| Brown | 75,000 | 45% |
| Carter | 225,000 | 20% |
Denver contributes $150,000 to the partnership for a 25% interest. Assume the partnership's identifiable net assets are carried at amounts approximating value. If the goodwill approach is used, Carter's capital balance immediately after the addition of Denver will be:
|
| 1. 175,000 | |
|
| 2. 88,500 | |
|
| 3. 225,000 | |
|
| 4. 231,000 |
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started
International Accounting
Authors: Frederick D. Choi, Gary K. Meek
7th Edition
978-0136111474, 0136111475
