For the 2015 year, I am getting the following capital equity's. In the 2016 year, McNabb is offering $73k to buy out Manning's shares in the company. Would this not mean that Manning is getting an extra $20k for his shares, since there value is about $53k? If not then how would the net income of the year be calculated so part b and c. The whole question is attached for additional information.

AutoSave O Off) 4.5 Assi... ekta sharma ES 0 X X File Home Insert Draw Page Layout Formulas Data Review View Help ( - C rodsb.elearningontario.ca/content/BUS/1... Q X Conditional Formatting O b) Record the entry to allocate the net income to the partners' capital accounts. Paste Font Alignment Number Format as Table Cell Styles Cells Editing Ideas ") Prepare a Statement of Partners' Equity for 2014. 2015 Clipboard Styles Ideas January 1 - McNabb joins the partnership by contributing $46 000 in cash. A new partnership agreement is drawn up. Brady, Manning and McNabb agree to salaries of $5 000 for each partner F23 X V and a 5:4:3 income ratio. December 31 - The business recorded a net income of $30 000. Brady had drawings of $20 000 A B C D E F and Manning had drawings of $4 000. 3 For the years ending December 31, 2014-2016 a) Record the entry to admit the new partner into the business. b) Record the entry to allocate the net income to the partners' capital accounts. 6 2014 Brady Manning McNabb Total c) Prepare a Statement of Partners' Equity for 2015. 7 Balance, Jan. 1 $ 47,000.00 $ 54,000.00 S 101,000.00 2016 January 1 - Manning decides to leave the partnership. McNabb agrees to pay Manning $73 000 in 8 Add: Investments a private transaction for his entire share in the business. The result is that all of Manning's equity will 9 Net Income $ 13,333.33 $ 10,666.67 $ 24,000.00 be transferred to McNabb. The income or loss will now be divided equally (50-50) between Brady 10 Subtotal $60,333.33 $ 64,666.67 $125,000.00 and McNabb. There will be no salary. December 31 - The business recorded a net loss of $46 000. There were no drawings. Show the 11 Less: Drawings $ 16,000.00 16,000.00 Equity for 2016. entry to allocate the net income to the partners' capital accounts. Prepare a Statement of Partners' 12 Balance, Dec. 31 $60,333.33 $ 48,666.67 $109,000.00 13 a) Prepare the entry to record the departure of Manning. 14 2015 b) Record the entry to allocate the net income to the partners' capital accounts. 15 Balance, Jan. 1 60,333.33 $ 48,666.67 $ 46,000.00 $ 155,000.00 c) Prepare a Statement of Partners' Equity for 2016. 16 Add: Investments 2017 17 Net Income $ 11,250.50 $ 9,999 50 $ 8,750.00 $ 30,000.00 January 1 - The partners decide to liquidate the partnership. They have the following balances: 18 Subtotal $ 71,583.83 $ 58,666.17 $ 54,750.00 $ 185,000.00 Cash $29 917 $ Accounts Receivable $4 500 19 Less: Drawings 20,000.00 $ 4,000.00 24,000.00 Equipment $ 110 000 20 Balance, Dec. 31 $ 51,583.83 $ 54,666.17 $ 54,750.00 $ 161,000.00 Accumulated Depreciation $ 25 000 Accounts Payable $ 4 417 21 The partners were able to collect $3 500 of the accounts receivable and sell the equipment for $72 22 2016 000. 23 Balance, Jan. 1 a) Record all journal entries to dissolve the partnership. . . . Statement of Partner's Equity + Ready - + 100% Unless otherwise indicated, all images in this activity are from the public domain or are @ clipart.com or Microsoft clipart and are used with permission. O Type here to search e O In W A OX ENG 4:35 PM 5/17/20202014 February 1 - Brady and Manning decide to start up a partnership. Brady brings in $10 000 cash and equipment costing $60 000, with $17 000 in the accumulated depreciation account. The fair market value of the equipment is $37 000. Manning brings $54 000 in cash. They agree to an income ratio of 5:4. December 31 - The business records a net income of $24 000, and Brady has a debit balance of $16 000 in his drawings account. a) Record the journal entry to establish the partnership. b) Record the entry to allocate the net income to the partners' capital accounts. cJ Prepare a Statement of Partners' Equity for 2014. 2015 January 1 - McNabb joins the partnership by contributing $46 000 in cash. A new partnership agreement is drawn up. Brady, Manning and McNabb agree to salaries of $5 000 for each partner and a 5:4:3 income ratio. December 31 - The business recorded a net income of $30 000. Brady had drawings of $20 000 and Manning had drawings of $4 000. a) Record the entry to admit the new partner into the business. b) Record the entry to allocate the net income to the partners' capital accounts. c) Prepare a Statement of Partners' Equity for 2015