Assume that Partners A and B each report a Capital Account of $300,000. Partner C wants to join the partnership as an equal one-third partner. Because the partnership has been very profitable, Partners A and B require Partner C to contribute $800,000 in cash to the partnership in return for a one-third interest. Assume that Partners A and B share profits 60% and 40%, respectively, prior to the admission of Partner C. After admission of Partner C, Partners A and B retain their relative proportion of profit allocation after granting Partner C a 25% profit-allocation interest. Use the Bonus Method to record the journal entry on the books of the partnership to reflect the admission of Partner C.
Prepare journal entry on the books of the partnership to reflect the admission of Partner C.
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Assume that Partners A and B each report a Capital Account of $300,000. Partner C wants to join the...
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