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Naddika [18.5K]
3 years ago
15

Exercise 189 Hu, Marcos, and Letterman share income on a 6:3:1 basis. They have capital balances of $80,000, $60,000, and $45,00

0, respectively, when Buffett is admitted to the partnership. Prepare the journal entry to record the admission of Buffett into the partnership if Buffett purchases one-half of Hu’s equity for $45,000; one-half of Marcos’s equity for $22,000; and one-third of Letterman’s equity for $18,000. (Credit account titles are automatically indented when the amount is entered. Do not indent manually.)
Business
1 answer:
LekaFEV [45]3 years ago
4 0

Answer:

Debit Hu, 40,000, Marcos, 30,000 and Letterman 15,000 and credit Buffet, 85,000

Explanation:

The question is to journalize the entry of admitting Buffet into the partnership

First, we know that Buffet bought 1/2 of Hu, 1/2 of Marcos and 1/3 of Letterman.

Has such Buffet bought the following number of shares

Hu = 1/2 x $80,000 = $40,000

Marcos = 1/2 of $60,000 = $30,000

Letterman = 1/3 of $45,000 = $15,000

Buffet= 85,000

Jounal Entry

Description                                       Debit($)             Credit($)

Hu, Capital                                      40,000

Marco, Capital                                30,000

Letterman, Capital                         15,000

     Buffet, Capital                                              $85,000

Being the admission of Buffet in to partnership.              

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A two-year bond with par value $1,000 making annual coupon payments of $99 is priced at $1,000.
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Answer:

(a) 9.9%

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The further explanation is given below.

Explanation:

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Coupon payment

=  $99

Price

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(a)

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Came to the realization compound YTM is therefore a function of r, as is shown throughout the table below:

Rate (r)             Total proceeds         Realized YTM ((\frac{proceeds}{1000} )^{.5} - 1)

7.9%                      1205.8                                   9.8%

9.9%                             1207.8                                   9.9%

11.9%                      1209.8                                  9.99%

Now,

Overall proceeds realized YTM:

= \frac{proceeds}{1000} -18 \ percent \ 1,\frac{2081208}{1000} - 1

= 0.0991

= 9.91 \ percent \ 10 \ percent \ 1,\frac{2101210}{1000}- 1

= 0.1000

= 10.00 \ percent \ 12 \ percent \ 1,\frac{2121212}{1000}-1

= 0.1009

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