The Distance Plus partnership has the following capital balances at the beginning of the current year:Each of the following questions should be viewed independently.If Sergio invests $100,000 in cash in the business for a 25 percent interest, what journal entry is recorded? Assume that the bonus method is used.If Sergio invests $60,000 in cash in the business for a 25 percent interest, what journal entry is recorded? Assume that the bonus method is used.If Sergio invests $72,000 in cash in the business for a 25 percent interest, what journal entry is recorded? Assume that the goodwill method is used. Tiger (50% of profits and losses)Phil (30%)Ernie (20%)..$85,00060,00055,000....

Under the bonus method, the total capital investment is calculated by adding the investment of a new…

Answered: Tiger (50% of profits and losses) Phil…

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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The Distance Plus partnership has the following capital balances at the beginning of the current year:

Each of the following questions should be viewed independently.

If Sergio invests $100,000 in cash in the business for a 25 percent interest, what journal entry is recorded? Assume that the bonus method is used.
If Sergio invests $60,000 in cash in the business for a 25 percent interest, what journal entry is recorded? Assume that the bonus method is used.
If Sergio invests $72,000 in cash in the business for a 25 percent interest, what journal entry is recorded? Assume that the goodwill method is used.

Tiger (50% of profits and losses)
Phil (30%)
Ernie (20%)..
$85,000
60,000
55,000
....

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