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L. Carson agrees to pay $10,000 each to to C. Ames and D. Barker for 1/3 of their interest in the Ames-Barker partnership. At the time of the admission of Carson, each partner has a $30,000 capital balance. Both partners therefore give up $10,000 of their capital equity. (case 1)
Assume that instead of purchasing an interest, Carson invests $30,000 in cash in the Ames-Barker partnership for a 1/3 capital interest. (case 2)
Requirements :
1.provide Journal Entry in Case 1 &the effects of this transaction on the partnership accounts (use t-account)
2.Provide Journal Entry in Case 2 &the effects of this transaction on the partnership accounts (use t-account)
3.Total Capital for
a.Case 1
b. Case 2
3 answers