Davis and North, partners in an advertising business, share profits and losses in the ratio of...

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Davis and North, partners in an advertising business, share profits and losses in the ratio of 7:4, respectively. Prior to recording the admission of Martin as a new partner, Davis has a capital balance of $80,000, and North has a capital balance of $100,000. Required: For each of the following independent cases, prepare the journal entry that was made to record the admission of Martin into the partnership. 1. 2. 3. Davis invested $50,000 cash in the partnership for a 20% interest. The goodwill/revaluation method is used and the fair value of the land is $5,000 more than the book value on this date. Martin invested $40,000 cash in the partnership for a 10% ownership interest. The bonus method is used. Martin purchased 25% of the respective capital balances of Davis and North, paying $40,000 cash directly to each of them. Davis and North, partners in an advertising business, share profits and losses in the ratio of 7:4, respectively. Prior to recording the admission of Martin as a new partner, Davis has a capital balance of $80,000, and North has a capital balance of $100,000. Required: For each of the following independent cases, prepare the journal entry that was made to record the admission of Martin into the partnership. 1. 2. 3. Davis invested $50,000 cash in the partnership for a 20% interest. The goodwill/revaluation method is used and the fair value of the land is $5,000 more than the book value on this date. Martin invested $40,000 cash in the partnership for a 10% ownership interest. The bonus method is used. Martin purchased 25% of the respective capital balances of Davis and North, paying $40,000 cash directly to each of them.

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