The Distance Plus partnership has the following capital balances at the beginning of the current year along with respective profit and loss percentages: Tiger (40%) $ 150,000 Phil (30%) 120,000 Ernie (30%) 135,000 Each of the following questions should be viewed independently. Required: If Sergio invests $180,000 in cash in the business for a 20 percent interest, what journal entry is recorded? Assume that the bonus method is used. If Sergio invests $100,000 in cash in the business for a 20 percent interest, what journal entry is recorded? Assume that the bonus method is used. If Sergio invests $102,000 in cash in the business for a 20 percent interest, what journal entry is recorded? Assume that the goodwill method is used.
The Distance Plus partnership has the following capital balances at the beginning of the current year along with respective profit and loss percentages: Tiger (40%) $ 150,000 Phil (30%) 120,000 Ernie (30%) 135,000 Each of the following questions should be viewed independently. Required: If Sergio invests $180,000 in cash in the business for a 20 percent interest, what journal entry is recorded? Assume that the bonus method is used. If Sergio invests $100,000 in cash in the business for a 20 percent interest, what journal entry is recorded? Assume that the bonus method is used. If Sergio invests $102,000 in cash in the business for a 20 percent interest, what journal entry is recorded? Assume that the goodwill method is used.
Chapter14: Choice Of Business Entity—operations And Distributions
Section: Chapter Questions
Problem 47P
Question
The Distance Plus partnership has the following capital balances at the beginning of the current year along with respective
Tiger (40%) | $ 150,000 |
---|---|
Phil (30%) | 120,000 |
Ernie (30%) | 135,000 |
Each of the following questions should be viewed independently.
Required:
-
If Sergio invests $180,000 in cash in the business for a 20 percent interest, what
journal entry is recorded? Assume that the bonus method is used. -
If Sergio invests $100,000 in cash in the business for a 20 percent interest, what journal entry is recorded? Assume that the bonus method is used.
-
If Sergio invests $102,000 in cash in the business for a 20 percent interest, what journal entry is recorded? Assume that the
goodwill method is used.
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