Frodo, Sam, Merry, and Pippen are in a partnership together and have a combined capital balance of $700,000. A new partner, Bilbo, pays the partnership $300,000 directly for a 1/5 interest in the new partnership. The partnership chooses the bonus method to existing partners to account for this transaction and will allocate any bonus evenly amongst the existing partners. The journal entry on the books of the partnership to account for this transaction would be: Question 24 options:

Debit Cash $300,000; Credit Capital-Bilbo $200,000, Credit each of the existing partners capital accounts $25,000 each

Debit each of the existing partners capital accounts $75,000 each; Credit Capital-Bilbo $300,000

Debit Cash $300,000; Credit Capital-Bilbo $300,000

Debit each of the existing partners capital accounts $50,000 each; Credit Capital-Bilbo $200,000

Frodo, Sam, Merry, and Pippen are in a partnership together and have a combined capital balance of $700,000. A new partner, Bilbo, pays the partnership $100,000 directly for a 1/5 interest in the new partnership. The partnership chooses the bonus method to the new partner to account for this transaction and will allocate any bonus evenly fro, the existing partners. The journal entry on the books of the partnership to account for this transaction would be:

Question 25 options:

	Debit Cash $160,000; Credit Capital-Bilbo $160,000
	Debit Cash $100,000, debit each of the existing partners capital accounts $25,000 each; Credit Capital-Bilbo $200,000
	Debit Cash $100,000, debit each of the existing partners capital accounts $15,000 each; Credit Capital-Bilbo $160,000
	Debit Cash $100,000; Credit Capital-Bilbo $100,000