Question

. Carlson Cits market value $5,500,000. The Et contributes $12-3 Accounting for partner contributions Kur and Warforming a partnership to develop a theme park near Cars onda kurr contribus cash of 300,000 and land with a current market of $10, When urrundused the land in 2015, its cost was 35,500 partnership will assume Kurth 500 note payable on the land Wyatt com Cash of SSD and again st a current market value of $5,500,000 Requirements 1. Journaline the partnerships receipt of assets and liabilities from Kurt and Wyatt i 2. Compute the partnershipotalassets, Dollabilities, and total partner immediately after organizing 512-4 Allocating profits and losses to the partners Stone and Smith had beginning capital balances of $18,000 and $13,000, respective The partners fail to agree on a profit and loss-sharing ratio. For the first monet June 2018), the partnership has a net loss of $9,000. Requirements 1. How much of this loss goes to Stone? How much goes to Smith 2. The partners withdrew no assets during June. What is each partner's capital balane at June 302 Prepare a T-account for each partner's capital account. S12-5 Allocating profits and losses to the partners Anderson, Macer, and Bell have capital balances of $22,000, $33,000, and $55,000 respectively. The partners share profits and losses as follows: a. The first $50,000 is divided based on the partners' capital balances. b. The next $50,000 is based on services, shared equally by Anderson and Bell. Macer does not receive a salary allowance. c. The remainder is divided equally Requirements 1. Compute cach partner's share of the $112,000 net income for the year. 2. Journalize the closing entry to allocate net income for the year. 512-6 Accounting for the admission of a new partner Sweet has a capital balance of $25,000; Scott's balance is $21,000. Hamlet pays $100,000 to purchase Scott's interest in the Sweet & Scott partnership. Scott receives the full $100,000 Requirements 1. Journalize the partnership's transaction to admit Hamlet to the partnership. 2. Must Sweet accept Hamlet as a full partner? What rights does Hamlet have after purchasing Scott's interest in the partnership? S12-7 Accounting for the admission of a new partner Penn has $90,500 capital and Hammet has $68,500 capital in the Penn & Hammet partnership Penn and Hammet share profits and losses equally. Judy Pilard contributes cash of $53,000 to acquire a 1/4 interest in the new partnership

Answer 1

S 12-3

required 1:- journal entry

Kurt contributes cash of amount $3,000,000

	Debit	Credit
Cash	$3,000,000
To shareholders equity		$3,000,000

Kurt also contributes with the land of market value of $10,500,000. Market value of asset is used because the asset would have cost the market value amount to purchase for the company and thus the fair market value should be recorded.

	Debit	Credit
Land - asset	$10,500,000
To shareholders equity		$10,500,000

The company also assume Kurt lisbliabi of $3,500,000. The company will assume the liability and thus reduce Kurt shareholders equity by the same amount.

	Debit	Credit
Shareholders equity	$3,500,000
To loan liability		$3,500,000

Wyatt :-

wyatt contributed $5,000,000 of cash.

	Debit	Credit
Cash	$5,000,000
To shareholders equity		$5,000,000

Wyatt also contribute the equipment worth $5,500,000

	Debit	Credit
Assets equipment	$5,500,000
To shareholders equity		$5,500,000

Thus the above journal entry show the account balance for the company at initiation.

required 2:-

T.A , T.L and t.sh.equity after organising

Total assets (T.A) from about journal entry can be seen as land and equipment and cash.

Total assets = land + equipment + cash

= $10,500,000 + $5,500,000 + $5,000,000 + $3,000,000

= $ 24,000,000

Total liability (T.L) as can be seen from journal entry is the liability of Kurt assumed.

T.l = $3,5000,000

Stockholders equity is calculated by summing the journal entry on the credit side of shareholders equity and substracting the debit side entries in shareholders equity .We get shareholders equity (SE) as.

$3,000,000

$10,500,000

$5,000,000

$5,500,000

$(3,500,000)

=. $20,500,000 (stockholders equity)

As can be seen the basic accounting equation is satisfied.

TA = TL + St.holder equity

$24,000,000 = $3,500,000 + $20,500,000

$24,000,000 = $24,000,000

Thus the company total asset, total liability, and Stockholder equity is calculated above.