Part II $(20$ points$)$

Partners $M$ and $N$ share profits$/$ losses on a $3$:$2$ basis. They had

capital balances of $$250,000$ and $$350,000,$ respectively, when $O$ was

admitted to the partnership.

Instructions

Prepare the journal entry to record the admission of $O$ under each of

the following assumptions:

$($b$)$

O invests $$200,000$ for a $20\%$ ownership interest.

$($c$)$

Prepare T accounts for M Capital and N Capital for situations $($a$)$ and

$($b$).$