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.)
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
None
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
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 3 steps with 2 images
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education