The ABCD partnership has a current balance sheet as below. They decide to admit E to the partnership. Cash and current assets Land Building and equipment (net) Totals S 85,000 244,000 201,000 $ 530,000 Liabilities A, capital B, capital C, capital D, capital Totals. S $ 84,000 64,000 84,000 134,000 164,000 530,000 a. E contributes $82,000 in cash to the business to receive a 22 percent interest in the partnership. Profits and losses have previously been split according to the following percentages: A, 10 percent; B, 30 percent; C, 20 percent; and D, 40 percent. After E makes this investment, what are the individual capital balances according to the Bonus Method?
The ABCD partnership has a current balance sheet as below. They decide to admit E to the partnership. Cash and current assets Land Building and equipment (net) Totals S 85,000 244,000 201,000 $ 530,000 Liabilities A, capital B, capital C, capital D, capital Totals. S $ 84,000 64,000 84,000 134,000 164,000 530,000 a. E contributes $82,000 in cash to the business to receive a 22 percent interest in the partnership. Profits and losses have previously been split according to the following percentages: A, 10 percent; B, 30 percent; C, 20 percent; and D, 40 percent. After E makes this investment, what are the individual capital balances according to the Bonus Method?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:The ABCD partnership has a current balance sheet as below. They decide to admit E to the partnership.
Cash and current assets
Land
Building and equipment (net)
Totals
Req A
$
Individuals
85,000
244,000
201,000
A
B
C
D
E
$ 530,000
(a)
Capital
Balances
Liabilities
A, capital
B, capital
C, capital
D, capital
Totals
a. E contributes $82,000 in cash to the business to receive a 22 percent interest in the partnership. Profits and losses have previously
been split according to the following percentages: A, 10 percent; B, 30 percent; C, 20 percent; and D, 40 percent. After E makes this
investment, what are the individual capital balances according to the Bonus Method?
Complete this question by entering your answers in the tabs below.
$
84,000
64,000
84,000
134,000
164,000
$ 530,000
a. E contributes $82,000 in cash to the business to receive a 22 percent interest in the partnership. Profits and losses have
previously been split according to the following percentages: A, 10 percent; B, 30 percent; C, 20 percent; and D, 40 percent.
After E makes this investment, what are the individual capital balances according to the Bonus Method?
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