The E.N.D. partnership has the following capital balances as of the end of the current year: Pineda Adams Fergie Gomez Total capital $ 270,000 240,000 230,000 220,000 $ 960,000 Answer each of the following independent questions: a. Assume that the partners share profits and losses 3:3:2:2, respectively. Fergie retires and is paid $269,000 based on the terms of the original partnership agreement. If the goodwill method is used, what is the capital balance of the remaining three partners? b. Assume that the partners share profits and losses 4:3:2:1, respectively. Pineda retires and is paid $355,000 based on the terms of the original partnership agreement. If the bonus method is used, what is the capital balance of the remaining three partners? (Do not round your intermediate calculations. Round your final answers to the nearest dollar amounts.)
The E.N.D. partnership has the following capital balances as of the end of the current year: Pineda Adams Fergie Gomez Total capital $ 270,000 240,000 230,000 220,000 $ 960,000 Answer each of the following independent questions: a. Assume that the partners share profits and losses 3:3:2:2, respectively. Fergie retires and is paid $269,000 based on the terms of the original partnership agreement. If the goodwill method is used, what is the capital balance of the remaining three partners? b. Assume that the partners share profits and losses 4:3:2:1, respectively. Pineda retires and is paid $355,000 based on the terms of the original partnership agreement. If the bonus method is used, what is the capital balance of the remaining three partners? (Do not round your intermediate calculations. Round your final answers to the nearest dollar amounts.)
Chapter10: Partnerships: Formation, Operation, And Basis
Section: Chapter Questions
Problem 59P
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Transcribed Image Text:The E.N.D. partnership has the following capital balances as of the end of the current year:
Pineda
Adams
Fergie
Gomez
$ 270,000
240,000
230,000
220,000
Total capital
$ 960,000
Answer each of the following independent questions:
a. Assume that the partners share profits and losses 3:3:2:2, respectively. Fergie retires and is paid $269,000 based on
the terms of the original partnership agreement. If the goodwill method is used, what is the capital balance of the
remaining three partners?
b. Assume that the partners share profits and losses 4:3:2:1, respectively. Pineda retires and is paid $355,000 based on
the terms of the original partnership agreement. If the bonus method is used, what is the capital balance of the
remaining three partners? (Do not round your intermediate calculations. Round your final answers to the nearest
dollar amounts.)
Capital
Balance
a.
Pineda
$ 328,500
Adams
$
298,500
Gomez
$
259,000
b.
Adams
$
197,500
Fergie
201,667✓
Gomez
$
7,833 X
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