Eaton and Hunt have partner capital balances of $202,000 and $178,000, respectively. Eaton receives 60% of profits and losses, and Hunt receives 40%. Assume Peterson contributes $95,000 to acquire a 25% interest in the new partnership of Eaton, Hunt, and Peterson. Requirements 1. Calculate Peterson's capital in the new partnership. 2. Journalize the partnership's receipt of cash from Peterson. Requirement 1. Calculate Peterson's capital in the new partnership. Partnership capital before admission of new partner Contribution of new partner Partnership capital after admission of new partner Capital of new partner Bonus to
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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