Question

Kazma, Folkert, and Tucker are partners with capital account balances of $30,000, $75,000, and $45,000, respectively. Income and losses are divided in a 4:4:2 ratio. When Tucker decided to withdraw, the partnership revalued its assets from $225,000 to $252,000, which rep- resented an increase in the value of inventory of $8,000 and an increase in the value of land of $19,000. Tucker was then given $15,000 cash and a note for $40,000 for his withdrawal from the partnership.

Required:
A. Prepare the journal entry to record the revaluation of the partnership’s assets.
B. Prepare the journal entry to record the withdrawal using the following independent methods.
(1) Bonus.
(2) Partial goodwill.
(3) Full goodwill amount.



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  • CreatedMarch 16, 2015
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