Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Please just the first section not the withdrawal and include the calculations in the calculation area including the bonus to then new partner etc. also

image text in transcribedimage text in transcribedPlease just the first section not the withdrawal and include the calculations in the calculation area including the bonus to then new partner etc. also i would like to add the last time i asked for help the answers were incorrect so i hope i can get some help this time

At April 30, partners' capital balances in the ELM Company are as follows: V. Easi, $49,000; K. Lester, $24,000; and W. Matt, $17,000. The income-sharing ratios are 3:2:1, respectively. On May 1 , the ELMO Company is formed by admitting N. Ortiz to the firm as a partner. Journalize the admission of Ortiz under each of the following assumptions. SHOW your calculations! 1. Ortiz purchases 50% of Matt's ownership interest by paying Matt $9,000 cash. 2. Ortiz purchases 50% of Lester's ownership interest by paying Lester $16,000 cash. 3. Ortiz invests $35,000 cash in the partnership for a 40% ownership interest that includes a bonus to the new partner. 4. Ortiz invests $30,000 in the partnership for a 15% ownership interest. Bonuses are given to the old partners. Withdrawal journal entries: On December 31, the capital balances and income ratios in the ART Company are as follows: Journalize the withdrawal of Tower under each of the following assumptions. SHOW your calculations! (HINT: Once Tower leaves the partnership, the income sharing ratio does not equal 100% ): 1. Each of the remaining partners agrees to pay $12,000 cash from personal funds to purchase Tower's ownership equity. Each receives 50% of Tower's equity. 2. Ross agrees to purchase Tower's ownership interest for $18,000 cash. 3. From partnership assets, Tower is paid $29,000, which includes a bonus to him. 4. Tower is paid $17,000 from partnership assets, and bonuses to the remaining partners are recognized

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Auditing Integrated Concepts And Procedures

Authors: Donald H. Taylor, G. William Glezen

5th Edition

0471524239, 978-0471524236

More Books

Students also viewed these Accounting questions

Question

What kind of innovation would an improved electric toothbrush be?

Answered: 1 week ago

Question

What is the cycle of intimate partner abuse?

Answered: 1 week ago