Question
The Distance Plus partnership has the following capital balances at the beginning of the current year: Tiger (40% of profits and losses) $ 60,000 Phil
The Distance Plus partnership has the following capital balances at the beginning of the current year:
| Tiger (40% of profits and losses) | $ | 60,000 |
| Phil (30%) | 30,000 | |
| Ernie (30%) | 45,000 | |
Each of the following questions should be viewed independently.
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If Sergio invests $60,000 in cash in the business for a 20 percent interest, what journal entry is recorded? Assume that the bonus method is used.
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If Sergio invests $30,000 in cash in the business for a 20 percent interest, what journal entry is recorded? Assume that the bonus method is used.
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If Sergio invests $40,000 in cash in the business for a 20 percent interest, what journal entry is recorded? Assume that the goodwill method is used.
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.
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ISE Introductory Financial Accounting For Business
Authors: Thomas P. Edmonds, Christopher Edmonds
2nd Edition
1260575306, 9781260575309
