Soft Bound Version for Advanced Accounting 13th Edition
13th Edition
ISBN: 9781260110579
Author: Hoyle
Publisher: McGraw Hill Education
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Question
Chapter 14, Problem 28P
To determine
Determine the capital balances for the individual partners as of the end of each year: 2016 through 2018.
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Boswell and Johnson form a partnership on May 1, 2016. Boswell contributes cash of $50,000; Johnson conveys title to the following properties to the partnership:
Book value
Fair value
Land
$15000
$28000
Building and equipment
35000
36000
The partners agree to start their partnership with equal capital balances. No goodwill is to be recognized.According to the articles of partnership written by the partners, profits and losses are allocated based on the following formula:∙ Boswell receives a compensation allowance of $1,000 per month.∙ All remaining profits and losses are split 60:40 to Johnson and Boswell, respectively.∙ Each partner can make annual cash drawings of $5,000 beginning in 2017.Net income of $11,000 is earned by the business during 2016.Walpole is invited to join the partnership on January 1, 2017. Because of her business reputation and financial expertise, she is given a 40 percent interest for $54,000 cash. The bonus approach is used to record this…
Gorman and Morton form a partnership on May 1, 2019. Gorman contributes cash of $50,000; Morton conveys title to the following properties to the partnership:
BookValue
FairValue
Equipment
$
15,000
$
28,000
Licensing agreements
35,000
36,000
The partners agree to start their partnership with equal capital balances. No goodwill is to be recognized.
According to the articles of partnership written by the partners, profits and losses are allocated based on the following formula:
Gorman receives a compensation allowance of $1,000 per month.
All remaining profits and losses are split 40:60 between Gorman and Morton, respectively.
Each partner can make annual cash drawings of $25,000 beginning in 2020.
Net income of $11,000 is earned by the business during 2019.
Steele is invited to join the partnership on January 1, 2020. Because of her business reputation and financial expertise, she is given a 40 percent interest for $54,000 cash. The bonus approach is used…
Lori and Peter enter into a partnership and decide to share profits and losses as follows:
1 The first allocation is a salary allowance with Lori receiving $16,000 and Peter receiving $18,000.
2 The second allocation is 15% of the partners capital balances at year end. On December 31, 2019 the capital balances for Lori and Peter are $90,000 and $20,000, respectively.
3. Any remaining profit or loss is allocated equally. For the year ending December 31, 2019, the partnership reported net Income of $55,000 What is Lori's share of the net income?
A) $29,500
B) $20,250
C) $31,750
D) $23,250
Chapter 14 Solutions
Soft Bound Version for Advanced Accounting 13th Edition
Ch. 14 - Prob. 1QCh. 14 - Prob. 2QCh. 14 - Prob. 3QCh. 14 - Prob. 4QCh. 14 - Prob. 5QCh. 14 - Prob. 6QCh. 14 - Prob. 7QCh. 14 - Prob. 8QCh. 14 - Prob. 9QCh. 14 - Prob. 10Q
Ch. 14 - Prob. 11QCh. 14 - Prob. 12QCh. 14 - What is a partnership dissolution? Does...Ch. 14 - Prob. 14QCh. 14 - Prob. 15QCh. 14 - Prob. 16QCh. 14 - Prob. 17QCh. 14 - When a partner withdraws from a partnership, why...Ch. 14 - Prob. 1PCh. 14 - Prob. 2PCh. 14 - Prob. 3PCh. 14 - Prob. 4PCh. 14 - Prob. 5PCh. 14 - Prob. 6PCh. 14 - Prob. 7PCh. 14 - Prob. 8PCh. 14 - Prob. 9PCh. 14 - Prob. 10PCh. 14 - Prob. 11PCh. 14 - Prob. 12PCh. 14 - Prob. 13PCh. 14 - Prob. 14PCh. 14 - Prob. 15PCh. 14 - Prob. 16PCh. 14 - Prob. 17PCh. 14 - Prob. 18PCh. 14 - Prob. 19PCh. 14 - Prob. 20PCh. 14 - Prob. 21PCh. 14 - Prob. 22PCh. 14 - Prob. 23PCh. 14 - Prob. 24PCh. 14 - Prob. 25PCh. 14 - Prob. 26PCh. 14 - Following is the current balance sheet for a local...Ch. 14 - Prob. 28PCh. 14 - Prob. 29PCh. 14 - Prob. 30PCh. 14 - Prob. 31PCh. 14 - Prob. 2DYSCh. 14 - Prob. 3DYSCh. 14 - Prob. 4DYSCh. 14 - Prob. 5DYS
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