At year-end, the Circle City partnership has the following capital balances: Manning, Capital $150,000 Gonzalez, Capital 130,000 Clark, Capital 100,000 Freeney, Capital 90,000 Profits and losses are split on a 3:3:2:2 basis, respectively. Clark decides to leave the partnership and is paid $114,000 from the business based on the original contractual agreement. The payment made to Clark beyond his capital account was for Clark's share of previously unrecognized goodwill. After recognizing partnership goodwill, what is Manning's capital balance after Clark withdraws?
At year-end, the Circle City partnership has the following capital balances: Manning, Capital $150,000 Gonzalez, Capital 130,000 Clark, Capital 100,000 Freeney, Capital 90,000 Profits and losses are split on a 3:3:2:2 basis, respectively. Clark decides to leave the partnership and is paid $114,000 from the business based on the original contractual agreement. The payment made to Clark beyond his capital account was for Clark's share of previously unrecognized goodwill. After recognizing partnership goodwill, what is Manning's capital balance after Clark withdraws?
Chapter4: Gross Income: Concepts And Inclusions
Section: Chapter Questions
Problem 43P
Related questions
Question
Transcribed Image Text:At year-end, the Circle City partnership has the following capital balances:
Manning, Capital $150,000
Gonzalez, Capital 130,000
Clark, Capital
100,000
90,000
Freeney, Capital
Profits and losses are split on a 3:3:2:2 basis, respectively. Clark decides to leave the partnership and is paid $114,000 from the business based
on the original contractual agreement.
The payment made to Clark beyond his capital account was for Clark's share of previously unrecognized goodwill. After recognizing
partnership goodwill, what is Manning's capital balance after Clark withdraws?
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
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
Individual Income Taxes
Accounting
ISBN:
9780357109731
Author:
Hoffman
Publisher:
CENGAGE LEARNING - CONSIGNMENT
Individual Income Taxes
Accounting
ISBN:
9780357109731
Author:
Hoffman
Publisher:
CENGAGE LEARNING - CONSIGNMENT