Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

At April 30, partners' capital balances in PDL Company are G. Donley $55,000, C. Lamar $47, 200, and J. Pinkston $21, 600. The income sharing

image text in transcribed

At April 30, partners' capital balances in PDL Company are G. Donley $55,000, C. Lamar $47, 200, and J. Pinkston $21, 600. The income sharing ratios are 5: 4: 1, respectively. On May 1, the PDLT Company is formed by admitting J. Terrell to the firm as a partner. Journalize the admission of Terrell under each of the following independent assumptions. (Credit account titles are automatically indented when amount is entered. Do not indent manually. Round answers to 0 decimal places, e.g. 5, 275.) Terrell purchases 50% of Pinkston's ownership interest by paying Pinkston $16, 400 in cash. Terrell purchases 33^1/3% of Lamar's ownership interest by paying Lamar $15,000 in cash. Terrell invests $61, 400 for a 30% ownership interest, and bonuses are given to the old partners. Terrell invests $43, 400 for a 30% ownership interest, which includes a bonus to the new partner. Lamar's capital balance is $32, 800 after admitting Terrell to the partnership by investment. If Lamar's ownership interest is 20% of total partnership capital, what were (1) Terrell's cash investment and (2) the bonus to the new partner? Terrell's cash investment Bonus to new partner

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Financial Accounting The Cornerstone Of Business Decision Making

Authors: Jay S Rich, Jeff Jones, Linda Ann Myers

5th Edition

0357132696, 978-0357132692

More Books

Students also viewed these Accounting questions

Question

6. Identify seven types of hidden histories.

Answered: 1 week ago

Question

What is human nature?

Answered: 1 week ago