Exercise 12-9 Admission of new partner LO P3

The Struter Partnership has total partners' equity of $420,000, which is made up of Main, Capital, $294,000, and Frist, Capital, $126,000. The partners share net income and loss in a ratio of 80% to Main and 20% to Frist. On November 1, Adison is admitted to the partnership and given a 20% interest in equity and a 20% share in any income and loss. Prepare journal entries to record the admission of Adison for a 20% interest in the equity and a 20% share in any income and loss under the following independent assumptions.

1. (1) Record the admission of Adison with an investment of $105,000 for a 20% interest in the equity and a 20% share in any income and loss.

2. (2) Record the admission of Adison with an investment of $140,000 for a 20% interest in the equity and a 20% share in any income and loss.

3. (3) Record the admission of Adison with an investment of $75,000 for a 20% interest in the equity and a 20% share in any income and loss.

Answer is not complete. No Transaction General Journal Credit 1 Debit 105,000 (1) Cash Adison, Capital 105,000 (2) X 35,000 X Adison, Capital Main, Capital Frist, Capital 28,000 7,000 (3) Cash Main, Capital Frist, Capital Adison, Capital OOOO 75,000 24,000 X 6,000 8 105,000