My question, referring to number one of the problem is, what happens to the $40,000 over the book value that was paid for an interest in the partnership? Rob paid $120,000, he acquired capital with book value of 80,000.

Dont answer the questions from the picture of the textbook question.

Recording new partner investment The capital accounts of the Fax and Bel partnership on September 30, 2016, were: Fax capital (75% profit) Bel capital (25% profit) $140,000 60,000 Total capital On October 1, Rob was admitted to a 40 percent interest in the partnership when he purchased 40 percent of each existing partner's capital for $120,000, paid directly to Fax and Bel. REQUIRED 1. Determine the capital balances of Fax. Bel, and Rob after Rob's admission to the partnership if goodwill is not recorded. 2. Determine the capital balances of ax. Bel, and Rob after Rob's admission to the partnership if goodwill is recorded, assuming that the book value and fair value of recorded assets are equal. 01 Neu bel cpinto, (21) 0,000 (4o2 200,00