Alert Medical, LLC, consists of two doctors, Abrams and Lipscomb, who share in all income and losses according to a 2:3 income-sharing ratio. Dr. Lin has been asked to join the LLC. Prior to admitting Lin, the assets of Alert Medical were revalued to reflect their current market values. The revaluation resulted medical equipment being increased by $21,000. Prior to the revaluation, the equity balances for Abrams and Lipscomb were $202,000 and $231,000, respectively. a. Provide the journal entry for the asset revaluation. If an amount box does not require an entry, leave it blank. Medical Equipment v 21,000 Abrams, Member Equity V 8,400 Lipscomb, Member Equity v 12,600 Feedback Check My Work b. Provide the journal entry for the bonus under the following independent situations: 1. Lin purchased a 30% interest in Alert Medical, LLC, for $259,000. If an amount box does not require an entry, leave it blank. Cash v 259,000 V Abrams, Member Equity v 20,800 X Lipscomb, Member Equity 31,200 Lin, Member Equity v 207,000 X Feedback Check My Work 2. Lin purchased a 25% interest in Alert Medical, LLC, for $132,000. If an amount box does not require an entry, leave it blank. Cash v 132,000 V Abrams, Member Equity v 16,100 x Lipscomb, Member Equity 24,150 X Lin, Member Equity v 172,250
Alert Medical, LLC, consists of two doctors, Abrams and Lipscomb, who share in all income and losses according to a 2:3 income-sharing ratio. Dr. Lin has been asked to join the LLC. Prior to admitting Lin, the assets of Alert Medical were revalued to reflect their current market values. The revaluation resulted medical equipment being increased by $21,000. Prior to the revaluation, the equity balances for Abrams and Lipscomb were $202,000 and $231,000, respectively. a. Provide the journal entry for the asset revaluation. If an amount box does not require an entry, leave it blank. Medical Equipment v 21,000 Abrams, Member Equity V 8,400 Lipscomb, Member Equity v 12,600 Feedback Check My Work b. Provide the journal entry for the bonus under the following independent situations: 1. Lin purchased a 30% interest in Alert Medical, LLC, for $259,000. If an amount box does not require an entry, leave it blank. Cash v 259,000 V Abrams, Member Equity v 20,800 X Lipscomb, Member Equity 31,200 Lin, Member Equity v 207,000 X Feedback Check My Work 2. Lin purchased a 25% interest in Alert Medical, LLC, for $132,000. If an amount box does not require an entry, leave it blank. Cash v 132,000 V Abrams, Member Equity v 16,100 x Lipscomb, Member Equity 24,150 X Lin, Member Equity v 172,250
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Transcribed Image Text:Admitting a New LLC Member With Bonus
Alert Medical, LLC, consists of two doctors, Abrams and Lipscomb, who share in all income and losses according to a 2:3 income-sharing ratio. Dr. Lin has been asked to join the LLC. Prior to admitting Lin, the assets of Alert
Medical were revalued to reflect their current market values. The revaluation resulted in medical equipment being increased by $21,000. Prior to the revaluation, the equity balances for Abrams and Lipscomb were $202,000 and
$231,000, respectively.
a. Provide the journal entry for the asset revaluation. If an amount box does not require an entry, leave it blank.
Medical Equipment
21,000
Abrams, Member Equity v
8,400
Lipscomb, Member Equity V
12,600
Feedback
Check My Work
b. Provide the journal entry for the bonus under the following independent situations:
1. Lin purchased a 30% interest in Alert Medical, LLC, for $259,000. If an amount box does not require an entry, leave it blank.
Cash v
259,000
Abrams, Member Equity
20,800
Lipscomb, Member Equity v
31,200 X
Lin, Member Equity v
207,000
Feedback
Check My Work
2. Lin purchased a 25% interest in Alert Medical, LLC, for $132,000. If an amount box does not require an entry, leave it blank.
Cash v
132,000
Abrams, Member Equity v
16,100
Lipscomb, Member Equity
24,150 X
Lin, Member Equity v
172,250 X
Feedback
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