The partnership of Arun and Margot shares profits and losses in a 2:1 ratio, and the partners have capital balances of $62,000 each. Prepare a schedule showing how the bonus should be divided if Tammy joins the partnership with a $20,000 investment. The partner's new agreement will share profit and loss equally

The partnership of Arun and Margot shares profits and losses in a 2:1 ratio, and the partners have capital balances of $62,000 each. Prepare a schedule showing how the bonus should be divided if Tammy joins the partnership with a $20,000 investment. The partner's new agreement will share profit and loss equally

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter15: Partnership Accounting

Section: Chapter Questions

Problem 2PA: Arun and Margot want to admit Tammy as a third partner for their partnership. Their capital balances...

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SCORE: NAME: PROFESSOR: SECTION: Problem #15 Determining a New Partner's Investment Cost respectively. P150,000 Accounts Payable Morales, Capital Gamino, Capital Quito, Capital Total Liabilities and Capital 260,000 P 40,000 710,000 Cash 180,000 Other Assets 160,000 P750,000 Total Assets P750,000 Assume that the partnership decided to admit Abello as a new partner with a one. fourth interest. Required: For each of the following independent cases, determine the amount that Abello must contribute in cash or other assets: 1. No goodwill or bonus will be recorded. 2. A bonus of P24,000 is to be paid by Abello and allocated to the prior partners. 3. The partners agreed that total resulting capital should be P820,000 and no goodwill should be recognized. 4. Other assets are written down by P20,000 and a bonus of P40,000 is paid to Abello at the time of admission.