On July 1. the Duncan & Evan partnership agreed to admit Foster to the partnership, Foster wilureccive a 40% share of the business for a cash invéstment of $200,000. Information regarding theQuestion 2partnership records prior to the admission of Foster is located in the tableEvanDuncan$125,000$75,0002Capital balanceProfit sharing ratioPrepare the journal entry to admit Foster into the partnership. Show calculationsRecord journal entries for each of the following unrelated transactionsOn July 5, Adobe Corporation issued 500 of its common shares for a total of $10,000.1.On June 1, Baker Corporation issucd 1,000 of its preferred shares in exchange for landvalued at $50.000, Baker's shares are not widely held or regularly traded. Four years ago,500 preferred shares were issued for $35 a share.2.2. On April 12, Hobson Corporation declared a quarterly dividend of $0.05 per share onits 200,000 common shares. The dividend will be paid on Apr 29, to the shareholders ofrecord on April 19. Prepare the journal entry necessary for each date.93. Martok Company sells personal computers for $2,300 cach. The price includes a two-yearwarranty. During 2015, the company sells 400 computers. On the basis of past experience, thewarranty costs are estimated to be $250 per computer. The actual warranty costs paid by Martokduring 2015 were $65,000. Prepare general journal entries to record the estimated warrantyexpense and the warranty payments during 2015.Interest of 10% based upon their averagecapital balances which are:$85,000$65,000$50,000Remainder shared in this ratio21(a) Prepare a detailed schedule to show how the profit would be allocated among the threepartners.b) Assume that the revenue and expense accounts have been closed. Prepare the remainingclosing entries.

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Question 2 On July 1. the Duncan & Evan partnership agreed to admit Foster to the partnership. Foster will reccive a 40% share of the business for a cash investment of $200,000. Information regarding the partnership records prior to the admission of Foster is located in the table Capital balance Profit sharing ratio Duncan $125,000 3. Evan $75,000 2. Prepare the joumal entry to admit Foster into the partnership. Show calculations anc

Question 2 On July 1. the Duncan & Evan partnership agreed to admit Foster to the partnership. Foster will reccive a 40% share of the business for a cash investment of $200,000. Information regarding the partnership records prior to the admission of Foster is located in the table Capital balance Profit sharing ratio Duncan $125,000 3. Evan $75,000 2. Prepare the joumal entry to admit Foster into the partnership. Show calculations anc

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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A-1
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Book A partnership has total equity of $464,000. Partnership equity consists of Green, Capital, $324,000, and Tan, Capital, $140,000. Net income and loss is shared in a ratio of 85% to Green and 15% to Tan. On December 1, the partnership accepts Brown as a new partner. Record the entry for Brown's admission under each separate situation. 1. Record the admission assuming Brown makes an investment of $118,000 cash for a 20% interest in equity and a 20% share of any income or loss. 2. Record the admission assuming Brown makes an investment of $161,000 cash for a 20% interest in equity and a 20% share of any income or loss. 3. Record the admission assuming Brown makes an investment of $84,000 cash for a 20% interest in equity and a 20% share in any income or loss.
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TRUE OR FALSE
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