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In the GMP partnership (to which Elan seeks admittance), the capital balances of Mary, Gene, and Pat, who share income in the ratio of 6:3:1,

In the GMP partnership (to which Elan seeks admittance), the capital balances of Mary, Gene, and Pat, who share income in the ratio of 6:3:1, are

Mary

$

249,600

Gene

124,800

Pat

41,600

Required: a. If no goodwill or bonus is recorded, how much must Elan invest for a one-third interest?

b. Prepare journal entry for the admission of Elan if she invests $80,600 for a 20 percent interest and goodwill is recorded.

c. Prepare journal entry for the admission of Elan if she invests $201,000 for a 20 percent interest. Total capital will be $617,000; the partners use the bonus method.

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