Question
Alert Medical, LLC, consists of two doctors, Abrams and Lipscomb, who share in all income and losses according to a 2:3 income-sharing ratio. Dr. Lin
Alert Medical, LLC, consists of two doctors, Abrams and Lipscomb, who share in all income and losses according to a 2:3 income-sharing ratio. Dr. Lin has been asked to join the LLC. Prior to admitting Lin, the assets of Alert Medical were revalued to reflect their current market values. The revaluation resulted in medical equipment being increased by $28,000. Prior to the revaluation, the equity balances for Abrams and Lipscomb were $269,000 and $308,000, respectively.
a. Provide the journal entry for the asset revaluation. For a compound transaction, if an amount box does not require an entry, leave it blank.
Medical Equipment | fill in the blank 919bb0ff9f8bfd5_2 | fill in the blank 919bb0ff9f8bfd5_3 | |
Abrams, Member Equity | fill in the blank 919bb0ff9f8bfd5_5 | fill in the blank 919bb0ff9f8bfd5_6 | |
Lipscomb, Member Equity | fill in the blank 919bb0ff9f8bfd5_8 | fill in the blank 919bb0ff9f8bfd5_9 |
Feedback
a. Adjust the medical equipment and adjust each member's equity account in their income-sharing ratio.
b. Provide the journal entry for the bonus under the following independent situations:
1. Lin purchased a 30% interest in Alert Medical, LLC, for $345,000. For a compound transaction, if an amount box does not require an entry, leave it blank.
Cash | fill in the blank 580ba707005bfd7_2 | fill in the blank 580ba707005bfd7_3 | |
Abrams, Member Equity | fill in the blank 580ba707005bfd7_5 | fill in the blank 580ba707005bfd7_6 | |
Lipscomb, Member Equity | fill in the blank 580ba707005bfd7_8 | fill in the blank 580ba707005bfd7_9 | |
Lin, Member Equity | fill in the blank 580ba707005bfd7_11 | fill in the blank 580ba707005bfd7_12 |
Feedback
b.1. Determine the total capital, including the new contribution. Calculate the new member's share of the total capital. If the new member's contribution exceeds his share of the capital, the bonus goes to the existing members. If the new member's share of the capital exceeds the contribution, the bonus goes to the new member.
2. Lin purchased a 25% interest in Alert Medical, LLC, for $175,000. For a compound transaction, if an amount box does not require an entry, leave it blank.
fill in the blank fd7d060c7ffcf95_2 | fill in the blank fd7d060c7ffcf95_3 | ||
fill in the blank fd7d060c7ffcf95_5 | fill in the blank fd7d060c7ffcf95_6 | ||
fill in the blank fd7d060c7ffcf95_8 | fill in the blank fd7d060c7ffcf95_9 | ||
fill in the blank fd7d060c7ffcf95_11 | fill in the blank fd7d060c7ffcf95_12 |
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