Problem 3: Record the purchase of an interest in the partnership, where the new partner is paying the old partnersrather than the partnership under each of the following approaches.

Assets 200,000

Liabilities 60,000

Capital:

Partner A (60%) 80,000

Partner B (30%) 45,000

Partner C (10%) 15,000

200,000

a. Apply the Bonus Method assuming D buys B's 30% interest for a total of $50,000. The funds are paid to B directly.

b. Apply the Goodwill Method assuming that D buys a 30% interest for a total of $50,000. The interest is bought proportionately from all of the partners.