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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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Tracy Company, a manufacturer of air conditioners, sold 100 units to Thomas Company on November 17, 2021. The units have a list
arlik [135]

Answer:

November 17

Trade Receivable-Thomas Company  $56,250 (debit)

Revenue  $56,250 (credit)

November 26

Cash $55,125 (debit)

Discount Allowed $1,125 (debit)

Trade Receivable-Thomas Company  $56,250 (credit)

Explanation:

November 17

Recognize Revenue and Recognize an Asset : Trade Receivable

Trade Receivable-Thomas Company  $56,250 (debit)

Revenue  $56,250 (credit)

Revenue Calculation = 100 units × $760 × 75% = $56,250

November 26

The payment date is within the cash discount period in terms of credit sale. Hence Thomas Company is granted cash discount of 2% (2/10, n/30).

Cash $55,125 (debit)

Discount Allowed $1,125 (debit)

Trade Receivable-Thomas Company  $56,250 (credit)

5 0
3 years ago
What types of money are included in the M2 category? Check all that apply.
RideAnS [48]

Answer:

A B C E

Explanation:

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3 years ago
Work performance information and cost forecasts are main outputs of which process
Dovator [93]

Work performance information and cost forecasts are the main outputs of cost control.

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3 0
2 years ago
Sheldon and Morton formed a partnership with capital contributions of $80,000 and $40,000, respectively. Their partnership agree
Anastaziya [24]

Answer:

The answer is:

Sheldon: $39, 500;     Morton: $50, 500

Explanation:

A partnership is a binding agreement between two or more parties to carry on a business. The sole purpose of this agreement is to share skills and expertise so as to generate a profit. In a partnership, the partners have unlimited liability meaning that if the business established by the partners in unable to repay creditors, the creditors are legally allowed to seize the personal assets of the partners to cover the debts owing. However, in accounting for financial performance, the business is considered to be a separate entity (exists independent of the partners). Sheldon and Morton have established a profit-sharing arrangement that compensates Sheldon for the capital contribution (larger interest share) and Morton for his contributions to the business operations (larger salary share). The profit after these deductions is shared equally between the 2 partners. Assuming the given net income is after operations but before partner deductions, the share of the partners is calculated as follows:

                               Sheldon                           Morton

Interest                   $8,000                              $4,000

Salaries                  $10,000                             $25,000

Profit share            <u>$21, 500 </u>                           <u>$21, 500</u>

Total share            <u>$39, 500</u>                            <u>$50, 500</u>

Interest        (10% * $80, 000)                           (10% * $40, 000)

Profit share (50% * $43,000)                           (50% * $43,000)

Net Profit Share: $90, 000 - $(8,000 + 10,000 + 4,000 + 25,000)= $43,000

                     

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3 years ago
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Answer:

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Explanation:

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2 years ago
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