a29. If a new partner invests in a partnership with book value and acquires a 1/4 share of the total capital of the company, it means that a premium has been paid to the original partners. Ex. 177Barr & Eglin Co. reports net income of $42,000. The partnership agreement provides annual salaries of $24,000 for Barr and $18,000 for Eglin, as well as interest deductions of $4,000 for Barr and $6,000 for Eglin. Any remaining income or loss will be shared 70% by Barr and 30% by Eglin. a133. Faget and Hein sell Melges a 1/3 stake in the Faget – Hein Partnership. Melges pays $140,000 to Faget and Hein each for admission to the organization. Prior to this transaction, Faget and Hein had capital balances of $210,000 each. The log entry to record the admission of Melges willa.
a cash charge of $280,000 .b. show no cash .c fees. show a debit to Hein, Capital for $140,000. show a credit to Melges, Capital for $280,000. 45. The partnership agreement should include the following conditions, with the exception of the following conditions: start date of the partnership.b. Main location of the business.c. surviving family members in the event of the death of a partner.d. Each of them should be included.
a37. The withdrawal of a partner legally dissolves the partnership. 78. The partnership agreement between Mayer and Rodin provides that profits and losses will be divided equally according to salary allowances of $400,000 for Mayer and $200,000 for Rodin. At the beginning of the year, Mayer`s capital account had a balance of $800,000, while Rodin`s capital account had a balance of $700,000. Net income for the year was $500,000. The balance of Rodin`s capital account at the end of the year after closing is after closing is. $950,000 .b. $200,000 .c.
$850,000. j. $900,000. a134. Letourneau invests $20,000 in cash (approval per investment) in the Seiler-Shaw partnership to acquire a 1/4 stake. In that case. Accounting is the same as when buying a .b of interest. the total net assets of the new partnership are unchanged from the previous partnership.c. the total capital of the new partnership is greater than the total capital of the old partnership.
Letourneau`s income ratio is automatically 1/4. I would say the biggest advantage is that it forces both of you to specify what you expect from the other party. You have discussed, as I understand it, how profits should be divided. Do you both totally agree? What if you decided that another method would be fairer? What do you plan to do if you want to add a partner? Who makes decisions about which building to rent and what type of assistance to rent? All of these things can be defined in a partnership agreement. 113. Mandy, Annie and Tammy formed a partnership with income participation rates of 50%, 30% and 20%, respectively. Cash of $300,000 was available after the liquidation of the company`s assets. Before the final distribution of the money, Mandy`s capital balance was $200,000, Annie`s capital balance was $150,000, and Tammy had a capital shortage of $50,000. Assuming Tammy needs money to make up for her lack of capital, Mandy should get one. .