Admitting New Partner With Bonus L. Bowers and V. Lipscomb are partners in Elegant Event Consultants. Bowers and Lipscomb share income equally. M. Ortiz will be admitted to the partnership. Prior to the admission, equipment was revalued downward by $8,000. The capital balances of each partner are $93,000 and $130,500, respectively, prior to the revaluation. a. Provide the journal entry for the asset revaluation. If an amount box does not require an entry, leave it blank. L. Bowers, Cap 4,000✔ S V. Lipscomb, Cal✓ 4,000 ✓ Equipmen ✓ Feedback Check My Work b. Provide the journal entry for Ortiz's admission under the following independent situations: 1. Ortiz purchased a 20% interest for $47,000. If an amount box does not require an entry, leave it blank. 47,000✔ Cash ✔ L. Bowers, Cap-✔ V. Lipscomb, Ca M. Ortiz, Capi✓ 8,000 ✓ Feedback Check My Work $2,500✔ 2. Ortiz purchased a 30% interest for $118,000. If an amount box does not require an entry, leave it blank. Cash ✔ 118,000✔ L. Bowers, Cap. ✔ V. Lipscomb, Cal M. Ortiz, Capi✓
Admitting New Partner With Bonus L. Bowers and V. Lipscomb are partners in Elegant Event Consultants. Bowers and Lipscomb share income equally. M. Ortiz will be admitted to the partnership. Prior to the admission, equipment was revalued downward by $8,000. The capital balances of each partner are $93,000 and $130,500, respectively, prior to the revaluation. a. Provide the journal entry for the asset revaluation. If an amount box does not require an entry, leave it blank. L. Bowers, Cap 4,000✔ S V. Lipscomb, Cal✓ 4,000 ✓ Equipmen ✓ Feedback Check My Work b. Provide the journal entry for Ortiz's admission under the following independent situations: 1. Ortiz purchased a 20% interest for $47,000. If an amount box does not require an entry, leave it blank. 47,000✔ Cash ✔ L. Bowers, Cap-✔ V. Lipscomb, Ca M. Ortiz, Capi✓ 8,000 ✓ Feedback Check My Work $2,500✔ 2. Ortiz purchased a 30% interest for $118,000. If an amount box does not require an entry, leave it blank. Cash ✔ 118,000✔ L. Bowers, Cap. ✔ V. Lipscomb, Cal M. Ortiz, Capi✓
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Concept explainers
Partnership Accounting
A partnership is a kind of arrangement between two or more people whereby they agree to manage the business operations and share its profits and losses in an agreed ratio between them. The agreement that is drafted and signed by the partners of the firm is termed as partnership deed and contains various important clauses agreed between the partners such as profit/loss sharing, interest on capital, remuneration allocation of each partner, drawings, admission of a new partner, etc.
Partner Admission and Withdrawal
A partnership is a kind of arrangement between two or more people whereby they agree to manage the business operations and share its profits and losses in an agreed ratio between them. The agreement that is drafted and signed by the partners of the firm is termed as a partnership deed and contains various important clauses agreed between the partners such as profit/loss sharing, interest on capital, remuneration allocation of each partner, drawings of a partner, etc.
Question
Transcribed Image Text:Admitting New Partner With Bonus
L. Bowers and V. Lipscomb are partners in Elegant Event Consultants. Bowers and Lipscomb share income equally. M. Ortiz will be admitted to the partnership. Prior to the admission, equipment was revalued downward by $8,000. The capital balances of each partner are
$93,000 and $130,500, respectively, prior to the revaluation.
a. Provide the journal entry for the asset revaluation. If an amount box does not require an entry, leave it blank.
L. Bowers, Cap ✔ 4,000 ✓
V. Lipscomb, Cal ✓4,000 ✓
Equipmen
Feedback
►Check My Work
b. Provide the journal entry for Ortiz's admission under the following independent situations:
1. Ortiz purchased a 20% interest for $47,000. If an amount box does not require an entry, leave it blank.
Cash ✓
47,000 ✓
L. Bowers, Cap ✓
V. Lipscomb, Cal ✔
M. Ortiz, Capi✓ ✓
Feedback
Check My Work
8,000✔
✓
52,500✔
2. Ortiz purchased a 30% interest for $118,000. If an amount box does not require an entry, leave it blank.
Cash ✔
118,000 ✓
L. Bowers, Cap ✔
V. Lipscomb, Cal
M. Ortiz, Capi
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