At April 30, partners' capital balances in DES Company are: Dexter $44,000. Emley $26,000, and Sigle...

 

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At April 30, partners' capital balances in DES Company are: Dexter $44,000. Emley $26,000, and Sigle $24,000. The income-sharing ratios are 5:3:2, respectively. On May 1, the DESW Company is formed by admitting Watson to the firm as a partner. Instructions (a) Journalize the admission of Watson under each of the following independent assumptions. (1) Watson purchases 50% of Sigle's ownership interest by paying Sigle $9,000 in cash. (2) Watson purchases 50% of Emley's ownership interest by paying Emley $15,000 in cash. (3) Watson invests $46,000 cash in the partnership for a 40% ownership interest that includes a bonus to the new partner. (4) Watson invests $30,000 in the partnership for a 20% ownership interest, and bonuses are given to the old partners. (b) Sigle's capital balance is $25,500 after admitting Watson to the partnership by invest- ment. If Sigle's ownership interest is 15% of total partnership capital, what were (1) Watson's cash investment and (2) the total bonus to the old partners? At April 30, partners' capital balances in DES Company are: Dexter $44,000. Emley $26,000, and Sigle $24,000. The income-sharing ratios are 5:3:2, respectively. On May 1, the DESW Company is formed by admitting Watson to the firm as a partner. Instructions (a) Journalize the admission of Watson under each of the following independent assumptions. (1) Watson purchases 50% of Sigle's ownership interest by paying Sigle $9,000 in cash. (2) Watson purchases 50% of Emley's ownership interest by paying Emley $15,000 in cash. (3) Watson invests $46,000 cash in the partnership for a 40% ownership interest that includes a bonus to the new partner. (4) Watson invests $30,000 in the partnership for a 20% ownership interest, and bonuses are given to the old partners. (b) Sigle's capital balance is $25,500 after admitting Watson to the partnership by invest- ment. If Sigle's ownership interest is 15% of total partnership capital, what were (1) Watson's cash investment and (2) the total bonus to the old partners?

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a Journal entries for the admission of Watson under each of the independent assumptions 1 Watson purchases 50 of Sigles ownership interest by paying S... View the full answer