1. Bill, Bob, and Bo are partners in the Trendy Company, a retailer of inexpensive kids' wear. They share profits and losses in a 1:4:5 ratio and have decided to expand their business territory. They have agreed to admit Burt to the partnership for a cash investment. Their capital balances are currently P60,000, P100,000, and P140,000, respectively. Burt has been offered a 25% interest in the firm for a P60,000 cash investment. 
2. Assuming Burt takes the offer, the entry to record his investment in the partnership includes a: 
3. 
   
4. a. debit to cash for P75,000 
5. 
   
6. b. debit to loss on sale of a partnership interest for P46,000 
7. 
   
8. c. credit to Bill, capital for P1,500 
9. 
   
10. d. debit to Bob, capital for P12,000

Answer rating: 100% (QA)

Answer Step 1 Calculation of Burt Capital P60000 P100000 P140000 P60000 25 P90000 Bonus from Bill ... View the full answer