The Distance Plus partnership has the following capital balances at the beginning of the current year:

Tiger (50% of profits and losses)	$	70,000
Phil (40%)		40,000
Ernie (10%)		55,000

the following questions should be viewed independently.

1) If Sergio invests $60,000 in cash in the business for a 20 percent interest, what journal entry is recorded? Assume that the goodwill method is used. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

a) Record the entry for goodwill allocation, during the admission of a new partner.

b) Record the investment made by the new partner in the business.