Question
Greg Thomas purchased one-half of Ian Hamiltons interest in the Freidman and Hamilton partnership for $49,500. Prior to the investment, land was revalued to a
Greg Thomas purchased one-half of Ian Hamiltons interest in the Freidman and Hamilton partnership for $49,500. Prior to the investment, land was revalued to a market value of $189,200 from a book value of $116,400. Adam Freidman and Ian Hamilton share net income equally. Hamilton had a capital balance of $52,400 prior to these transactions.
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Provide the journal entry for the revaluation of land.
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Provide the journal entry to admit Thomas.
Adriana Gonzalez and Sylvester Van Horne formed a partnership, dividing income as follows:
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Annual salary allowance to Gonzalez of $25,000.
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Interest of 5% on each partners capital balance on January 1.
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Any remaining net income divided to Gonzalez and Van Horne, 2:1.
Gonzalez and Van Horne had $126,000 and $189,000, respectively, in their January 1 capital balances. Net income for the year was $115,000.
How much net income should be distributed to Gonzalez and Van Horne?
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