In the GMP partnership (to which Elan seeks admittance), the capital balances of Mary, Gene, and Pat, who share income in the ratio of 6:3:1, are Mary Gene Pat $ 271,200 135,600 45,200 Required: a. If no goodwill or bonus is recorded, how much must Elan invest for a one-third interest? b. Prepare journal entry for the admission of Elan if she invests $80,300 for a 20 percent interest and goodwill is recorded. c. Prepare journal entry for the admission of Elan if she invests $201,000 for a 20 percent interest. Total capital will be $653,000; the partners use the bonus method.

In the GMP partnership (to which Elan seeks admittance), the capital balances of Mary, Gene, and Pat, who share income in the ratio of 6:3:1, are Mary Gene Pat $ 271,200 135,600 45,200 Required: a. If no goodwill or bonus is recorded, how much must Elan invest for a one-third interest? b. Prepare journal entry for the admission of Elan if she invests $80,300 for a 20 percent interest and goodwill is recorded. c. Prepare journal entry for the admission of Elan if she invests $201,000 for a 20 percent interest. Total capital will be $653,000; the partners use the bonus method.

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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