When Marlon retired from the partnership of Lara, Bella and Marlon, he was paid an amount more than his adjusted capital balance. Under the bonus method, the excess
When Marlon retired from the partnership of Lara, Bella and Marlon, he was paid an amount more than his adjusted capital balance. Under the bonus method, the excess
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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19. When Marlon retired from the partnership of Lara, Bella and Marlon, he was paid an amount more than his adjusted capital balance. Under the bonus method, the excess:
A. Was recorded as an expense
B. Was recorded as reduction to the capital balances of Lara and Bella.
C. Has no effect on the capital balances of Lara and Bella.
D. Was recorded as addition to the capital balance of Lara and Bella.
E. Answer not given.
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