The following are the capital balances of ABC Partnerships at August 1, 2016: Albert (40% P&L) $ 220,000 Bernard (40% P&L) 160,000 Conrad (20% P&L) 110,000 Dennis invests $ 270,000 in cash for a 30% ownership interest. The payment goes to the original partners. Revaluation/adjustment in asset is to be recognized upon Dennis admission. Required: Choose the correct answer with solution. 1. How much adjustment in asset should be recorded and what is dennis beginning capital balance. a. ______________, $410,000 and $270,000 b. ______________, $140,000 and $270,000 c. ______________, $140,000 and $189,000 d. ______________, $410,000 and $189,000
The following are the capital balances of ABC Partnerships at August 1, 2016: Albert (40% P&L) $ 220,000 Bernard (40% P&L) 160,000 Conrad (20% P&L) 110,000 Dennis invests $ 270,000 in cash for a 30% ownership interest. The payment goes to the original partners. Revaluation/adjustment in asset is to be recognized upon Dennis admission. Required: Choose the correct answer with solution. 1. How much adjustment in asset should be recorded and what is dennis beginning capital balance. a. ______________, $410,000 and $270,000 b. ______________, $140,000 and $270,000 c. ______________, $140,000 and $189,000 d. ______________, $410,000 and $189,000
Chapter21: Partnerships
Section: Chapter Questions
Problem 38P
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Question
The following are the capital balances of ABC Partnerships at August 1, 2016:
Albert (40% P&L) $ 220,000
Bernard (40% P&L) 160,000
Conrad (20% P&L) 110,000
Dennis invests $ 270,000 in cash for a 30% ownership interest. The payment goes to the original partners. Revaluation/adjustment in asset is to be recognized upon Dennis admission.
Required:
Choose the correct answer with solution.
1. How much adjustment in asset should be recorded and what is dennis beginning capital balance.
a. ______________, $410,000 and $270,000
b. ______________, $140,000 and $270,000
c. ______________, $140,000 and $189,000
d. ______________, $410,000 and $189,000
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