As of the beginning of the year, the JZ Partnership has the following capital balances and profit/loss allocation agreement:

Corea, capital (15%) 55,000

Pass, capital (50%) 110,000

Peterson, capital (35%) 75,000

The partnership has agreed to admit Monk as a partner with a 20% interest as of the beginning of the year. The new profit/loss allocation agreement will be Corea, 10%; Monk, 20%; Pass, 40%; and Peterson, 30%.

Requirements, including all calculations:

1. What amount must Monk contribute to purchase a 20% share in the partnership at book value? What would the balances in the partners capital accounts be in that case?
2. If Monk joins the partnership with a 20% interest by contributing $80,000, what are the balances in the capital accounts if the bonus method is used?
3. If Monk joins the partnership with a 20% interest by contributing $80,000, what are the balances in the capital accounts if the goodwill method is used?