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Please help, this is all part of one question as the information is a continuation. 2014 Y Exit Fullscreen January 1 - Brady and Manning
Please help, this is all part of one question as the information is a continuation.
2014 Y Exit Fullscreen January 1 - Brady and Manning decide to start up a partnership. Brady brings in $10000 cash and equipment with a fair market value of $37000. Manning brings $60000 in cash, but he is also bringing $6000 in accounts payable from his old business. They agree to an income ratio of 5:4. Show the entry to establish the partnership. December 31 - the business recorded a net income of $24000, and Brady had a debit balance of $16000 in his drawings account. Show the entry to allocate the net income to the partners' capital accounts using the income ratio. Prepare a Statement of Partners' Equity for 2014. 2015 January 1 - McNabb joins the partnership. He is anxious to join and agrees to pay $46000 for a 20% share of the business, with the bonus to the existing partners. Brady, Manning and McNabb agree to salaries of $5000 for each partner, and a 5:4:3 income ratio. Show the entry to admit the new partner into the business. December 31 - the business recorded a net income of $30000. Brady had drawings of $20000 and Manning had drawings of $4000. Show the entry to allocate the net income to the partners' capital accounts. Prepare a Statement of Partners' Equity for 2015. 2016 January 1 - Manning decides to leave the partnership. McNabb agrees to pay Manning $73000 in a private transaction. The result is that all of Manning's equity will be transferred to McNabb. The income or loss will now be divided between Brady and McNabb in a 50%,50% ratio. The partners no longer receive a salary. Show the entry to record the departure of Manning. December 31 - the business recorded a net loss of $46000. McNabb had drawings of $20834. Show the entry to allocate the net loss to the partners' capital accounts. Prepare a Statement of Partners' Equity for 2016. 2017 January 1 - The partners decide to liquidate the partnership. They have the following balances: Cash $12000 Accounts Receivable $8166 Equipment $110000 Accumulated Depreciation $25000 Accounts Payable $11000 The partners were able to collect $3500 of the accounts receivable and sell the equipment for $52000. Show the entry to sell off the assets. Show the entry to allocate the loss on sale to the partners. Show the entry to pay off the business liabilities. Show the entry to dissolve the partnership, allocating cash to the partnersStep by Step Solution
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