Financial Accounting
14th Edition
ISBN: 9781305088436
Author: Carl Warren, Jim Reeve, Jonathan Duchac
Publisher: Cengage Learning
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Chapter 12, Problem 11E
a. 1
To determine
Record the
a.2
To determine
Record the journal entry for the admission of F.
b.
To determine
Compute the capital balances of each partner after the admission of new partners G and F.
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The capital accounts of Trent Henry and Tim Chou have balances of $145,500 and $98,300, respectively. LeAnne Gilbert and Becky Clarke are to be admitted to the partnership. Gilbert buys one-fifth of Henry’s interest for $29,100 and one-fourth of Chou’s interest for $19,500. Clarke contributes $74,500 cash to the partnership, for which she is to receive an ownership equity of $74,500.
CHART OF ACCOUNTS
Henry, Chou, Gilbert, and Clarke
General Ledger
ASSETS
110
Cash
111
Petty Cash
112
Accounts Receivable
113
Allowance for Doubtful Accounts
114
Interest Receivable
115
Notes Receivable
116
Inventory
117
Office Supplies
118
Store Supplies
119
Prepaid Insurance
120
Land
123
Equipment
124
Accumulated Depreciation-Equipment
129
Asset Revaluations
133
Patent
REVENUE
410
Sales
610
Interest Revenue
EXPENSES
510
Cost of Merchandise Sold
520
Salaries Expense
521
Advertising Expense
522
Depreciation Expense-Equipment
523…
The capital accounts of Trent Henry and Tim Chou have balances of $147,400 and $92,600, respectively. LeAnne Gilbert and Becky Clarke are to be admitted to the partnership. Gilbert buys one-fifth of Henry’s interest for $27,400 and one-fourth of Chou’s interest for $19,000. Clarke contributes $75,000 cash to the partnership, for which she is to receive an ownership equity of $75,000.
a.
On December 31, journalize the entries to record the admission of (1) Gilbert and (2) Clarke. Refer to the chart of accounts for the exact wording of the account titles
The capital accounts of Trent Henry and Tim Chou have balances of $136, 500 and $95, 500, respectively.
LeAnne Gilbert and Becky Clarke are to be admitted to the partnership. Gilbert buys one-fifth of Henry's
interest for $31, 100 and one - fourth of Chou's interest for $19, 200. Clarke contributes $71, 200 cash to the
partnership, for which she is to receive an ownership equity of $71, 200. Required: a. On December 31,
journalize the entries to record the admission of (1) Gilbert and (2) Clarke. Refer to the chart of accounts for
the exact wording of the account titles. CNOW journals do not use lines for journal explanations. Every line
on a journal page is used for debit or credit entries. CNOW journals will automatically indent a credit entry
when a credit amount is entered. b. What are the capital balances of each partner after the admission of the
new partners?
Chapter 12 Solutions
Financial Accounting
Ch. 12 - Prob. 1DQCh. 12 - Prob. 2DQCh. 12 - Prob. 3DQCh. 12 - Prob. 4DQCh. 12 - Prob. 5DQCh. 12 - Prob. 6DQCh. 12 - Prob. 7DQCh. 12 - Prob. 8DQCh. 12 - Prob. 9DQCh. 12 - Prob. 10DQ
Ch. 12 - Prob. 1PEACh. 12 - Prob. 1PEBCh. 12 - Prob. 2PEACh. 12 - Prob. 2PEBCh. 12 - Prob. 3PEACh. 12 - Prob. 3PEBCh. 12 - Prob. 4PEACh. 12 - Prob. 4PEBCh. 12 - Prior to liquidating their partnership, Parker and...Ch. 12 - Liquidating partnerships Prior to liquidating...Ch. 12 - Prob. 6PEACh. 12 - Prob. 6PEBCh. 12 - Prob. 7PEACh. 12 - Eclipse Architects earned 1,800,000 during 2016...Ch. 12 - Prob. 1ECh. 12 - Prob. 2ECh. 12 - Prob. 3ECh. 12 - Prob. 4ECh. 12 - Prob. 5ECh. 12 - Prob. 6ECh. 12 - Prob. 7ECh. 12 - Marvel Media, LLC, has three members: WLKT...Ch. 12 - Prob. 9ECh. 12 - Prob. 10ECh. 12 - Prob. 11ECh. 12 - Prob. 12ECh. 12 - Prob. 13ECh. 12 - Prob. 14ECh. 12 - Prob. 15ECh. 12 - Prob. 16ECh. 12 - Prob. 17ECh. 12 - The statement of members equity for Bonanza, LLC,...Ch. 12 - Distribution of cash upon liquidation Hewitt and...Ch. 12 - Distribution of cash upon liquidation David Oliver...Ch. 12 - Liquidating partnershipscapital deficiency Lewis,...Ch. 12 - Prob. 22ECh. 12 - Prob. 23ECh. 12 - Statement of partnership liquidation After closing...Ch. 12 - Prob. 25ECh. 12 - Prob. 26ECh. 12 - The accounting firm of Deloitte Touche is the...Ch. 12 - Prob. 28ECh. 12 - Prob. 1PACh. 12 - Prob. 2PACh. 12 - Prob. 3PACh. 12 - Prob. 4PACh. 12 - Statement of partnership liquidation After the...Ch. 12 - Prob. 6PACh. 12 - Prob. 1PBCh. 12 - Prob. 2PBCh. 12 - Prob. 3PBCh. 12 - Prob. 4PBCh. 12 - Statement of partnership liquidation After the...Ch. 12 - On August 3, the firm of Chapelle, Rock, and Pryor...Ch. 12 - Prob. 1CPCh. 12 - Prob. 2CPCh. 12 - Prob. 3CPCh. 12 - Prob. 4CP
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- Arun and Margot want to admit Tammy as a third partner for their partnership. Their capital balances prior to Tammys admission are $50,000 each. Prepare a schedule showing how the bonus should be divided among the three, assuming the profit or loss agreement will be 1:3 once Tammy has been admitted and her contribution is: A. $20,000 B. $80,000 C. $50,000. In addition, show the resulting journal entries to each of the three partners capital accounts.arrow_forwardThe partnership of Arun, Margot, and Tammy has been doing well. Arun wants to retire and move to another state for a once-in-a-lifetime opportunity. The partners capital balances prior to Aruns retirement are $60,000 each. Prepare a schedule showing how Aruns withdrawal should be divided assuming his buyout is: A. $70,000 B. $45,000 C. $60,000. In addition, show the resulting entries to the capital accounts of each of the three.arrow_forwardThe capital accounts of Trent Henry and Tim Chou have balances of $160,000 and $100,000, respectively. LeAnne Gilbert and Becky Clarke are to be admitted to the partnership. Gilbert buys one-fifth of Henry’s interest for $35,000 and one-fourth of Chou’s interest for $29,000. Clarke contributes $90,000 cash to the partnership, for which she is to receivean ownership equity of $90,000.a. Journalize the entries to record the admission of (1) Gilbert and (2) Clarke.b. What are the capital balances of each partner after the admission of the new partners?arrow_forward
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