At April 30, partners' capital balances in Crane Company are G. Donley $54,080, C. Lamar $49,920, and J. Pinkston $18,720. The income sharing ratios are 5:4:1, respectively. On May 1, the PDLT Company is formed by admitting J. Terrell to the firm as a partner. (a) Journalize the admission of Terrell under each of the following independent assumptions. (Credit account titles are automatically indented when amount is entered. Do not indent manually. Round answers to O decimal places, e.g. 5,275.) (1) (2) (3) (4) No. Account Titles and Explanation 1. 2. 3. Terrell purchases 50% of Pinkston's ownership interest by paying Pinkston $16,640 in cash. Terrell purchases 33¹/3% of Lamar's ownership interest by paying Lamar $15,600 in cash. Terrell invests $64,480 for a 30% ownership interest, and bonuses are given to the old partners. Terrell invests $43,680 for a 30% ownership interest, which includes a bonus to the new partner. 4. V Debit Credit

At April 30, partners' capital balances in Crane Company are G. Donley $54,080, C. Lamar $49,920, and J. Pinkston $18,720. The income sharing ratios are 5:4:1, respectively. On May 1, the PDLT Company is formed by admitting J. Terrell to the firm as a partner. (a) Journalize the admission of Terrell under each of the following independent assumptions. (Credit account titles are automatically indented when amount is entered. Do not indent manually. Round answers to O decimal places, e.g. 5,275.) (1) (2) (3) (4) No. Account Titles and Explanation 1. 2. 3. Terrell purchases 50% of Pinkston's ownership interest by paying Pinkston $16,640 in cash. Terrell purchases 33¹/3% of Lamar's ownership interest by paying Lamar $15,600 in cash. Terrell invests $64,480 for a 30% ownership interest, and bonuses are given to the old partners. Terrell invests $43,680 for a 30% ownership interest, which includes a bonus to the new partner. 4. V Debit Credit

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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