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The Distance Plus partnership has the following capital balances at the beginning of the current year along with respective profit and loss percentages: Tiger (50%) Phil (20%) Ernie (30%) $ 135,000 105,000 120,000 Each of the following questions should be viewed independently. a. If Sergio invests $150,000 in cash in the business for a 20 percent interest, what journal entry is recorded? Assume that the bonus method is used. b. If Sergio invests $80,000 in cash in the business for a 20 percent interest, what journal entry is recorded? Assume that the bonus method is used. c. If Sergio invests $100,000 in cash in the business for a 20 percent interest, what journal entry is recorded? Assume that the goodwill method is used.

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Question 1 Assuming the existing capital balances are as follows Tiger 50 share 135 000 Phil 20 share 105 000 Ernie 30 share 120 000 Calculate the total capital of the existing partners before Sergio View the full answer


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Income Tax Fundamentals 2013

Income Tax Fundamentals 2013

ISBN: 9781285586618

31st Edition

Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill

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Posted Date: August 03, 2023 08:18:37
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