Admitting New Partner With Bonus. Cody Jenkins and Lacey Tanner formed a partnership to provide landscaping services. Jenkins and Tanner shared profits and losses equally. After all the tangible assets have been adjusted to current market prices, the capital accounts of Cody Jenkins and Lacey Tanner have balances of $60,000 and $78,000, respectively. Valeria Solano has expertise with using the computer to prepare landscape designs, cost estimates, and renderings. Jenkins and Tanner deem these skills useful; thus, Solano is admitted to the partnership at a 30% interest for a purchase price of $37,000. a. Determine the recipient and amount of the partner bonus. Valeria Solano ✓ Feedback Check My Work a.Determine the total capital, including the new contribution. Calculate the new partners' share of the total capital. If the new partner's contribution exceeds his share of the capital, the bonus goes to the current partners. If the new partner's share of the capital exceeds the contribution, the bonus goes to the new partner. b. Provide the journal entry to admit Solano into the partnership. If an amount box does not require an entry, leave it blank. Cash Cody Jenkins, Capital Lacey Tanner, Capital Valeria Solano, Capital ✓ ✓
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.
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