Gibbs, McGee and Ducky

Gibbs and McGee, partners in the G & M partnership, have capital balances of $100,000 and $40,000 and share income in a ratio of 4:1, respectively. Ducky is to be admitted into the partnership with a 20 percent interest in the business.

Record the journal entries for Duckys admission for each of the following independent situations:

1. Ducky invests $60,000, and goodwill is to be recorded.
2. Ducky invests $60,000. Total capital is to be $200,000.
3. Ducky purchases the 20 percent interest by paying Gibbs $22,000 and McGee $11,000. Ducky is assigned 20 percent of each of the others capital accounts.
4. Ducky invests $32,000. Total capital is to be $172,000.
5. Ducky invests $32,000, and goodwill is to be recorded.