Financial Accounting
15th Edition
ISBN: 9781337272124
Author: Carl Warren, James M. Reeve, Jonathan Duchac
Publisher: Cengage Learning
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Chapter 12, Problem 25E
a. 1
To determine
Provide
b.
To determine
Prepare the statement of partnership equity for the current year.
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Partnership entries and statement of partnership equity
The capital accounts of Hassan Khan and Dmitri Palovich have balances of $75,000 and $54,000, respectively, on January 1, 20Y4, the beginning of the fiscal year. On July 10,
Khan invested an additional $8,000. During the year, Khan and Palovich withdrew $40,000 and $32,000, respectively, and net income for the year was $102,000. Revenues were
$523,000, and expenses were $421,000. The articles of partnership make no reference to the division of net income.
a. Journalize the entry to close the revenues and expenses. If an amount box does not require an entry, leave it blank.
BE
Journalize the entry to close the drawing accounts. If an amount box does not require an entry, leave it blank.
EE
b. Prepare a statement of partnership equity for the current year for the partnership of Khan and Palovich. If an amount is zero or a blank, enter in 0.
Khan and Palovich
Statement of Partnership Equity
For the Year Ended December 31, 20Y4
Line…
Partnership Entries and Statement of Partnership Equity
The capital accounts of Lorraine Grecco and Carrie Rosenfeld have balances of $64,000 and $99,000, respectively, on January 1, 20Y4, the beginning of the fiscal year. On March 10, Grecco invested an additional $11,000. During the year, Grecco and Rosenfeld withdrew $43,000 and $53,000, respectively, and net income for the year was $84,000. Revenues were $654,000, and expenses were $570,000. The articles of partnership make no reference to the division of net income.
a. Journalize the entry to close the revenues and expenses. If an amount box does not require an entry, leave it blank. Journalize the entry to close the drawing accounts. If an amount box does not require an entry, leave it blank.
b. Prepare a statement of partnership equity for the current year for the partnership of Grecco and Rosenfeld. If an amount is zero or a blank, enter in 0.
After the tangible assets have been adjusted to current market prices, the capital accounts of Grayson Jackson and Harry Barge have balances of $44,920 and $60,890, respectively. Lewan Gorman is to be admitted to the partnership, contributing $32,080 cash to the partnership, for which he is to receive an ownership equity of $36,650. All partners share equally in income.
Required:
a.
On December 31, journalize the entry to record the admission of Gorman, who is to receive a bonus of $4,570. 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 partner?
c.
Why are tangible assets adjusted to current market prices, prior to admitting a new partner?
Chart of…
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 - Prob. 5PEACh. 12 - Liquidating partnerships Prior to liquidating...Ch. 12 - Prob. 6PEACh. 12 - Prob. 6PEBCh. 12 - Revenue per employee Niles and Cohen, CPAs earned...Ch. 12 - Prob. 7PEBCh. 12 - Prob. 1ECh. 12 - Prob. 2ECh. 12 - Prob. 3ECh. 12 - Prob. 4ECh. 12 - Prob. 5ECh. 12 - Prob. 6ECh. 12 - Prob. 7ECh. 12 - Prob. 8ECh. 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 - Statement of members equity, admitting new member...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. 21ECh. 12 - Prob. 22ECh. 12 - Statement of partnership liquidation After closing...Ch. 12 - Prob. 24ECh. 12 - Prob. 25ECh. 12 - Revenue per professional staff The accounting firm...Ch. 12 - Prob. 27ECh. 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. 3CPCh. 12 - Prob. 4CP
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