At April 30, partners' capital balances in Ivanhoe Company are G. Donley $44,720, C. Lamar $41,280, and J. Pinkston $15,480. 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 0 decimal places, e.g. 5,275.) (1) Terrell purchases 50% of Pinkston's ownership interest by paying Pinkston $13,760 in cash. Terrell purchases 33¹/3% of Lamar's ownership interest by paying Lamar $12,900 in cash. (2) (3) Terrell invests $53,320 for a 30% ownership interest, and bonuses are given to the old partners. Terrell invests $36,120 for a 30% ownership interest, which includes a bonus to the new partner. (4)

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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.