Answer:
a. and b.
May Cheng, Capital 69,000
Michael Cross, Capital 69,000
$207,000 × 1/3.
Note: The sale to Cross is not a transaction of the partnership, so the sales
price is not considered in this journal entry.
EX 12-10 Admitting new partners
May Cheng and Hannah Webster are partners who share in the income equally and have capital balances of $207,000 and $62,500, respectively. Cheng, with the consent of Webster, sells one-third of her interest to Michael Cross. What entry is required by the partnership if the sales price is (a) $60,000? (b) $80,000?
Answer:
a. and b.
May Cheng, Capital 69,000
Michael Cross, Capital 69,000
$207,000 × 1/3.
Note: The sale to Cross is not a transaction of the partnership, so the sales
price is not considered in this journal entry.
Answer:
a. and b.
May Cheng, Capital 69,000
Michael Cross, Capital 69,000
$207,000 × 1/3.
Note: The sale to Cross is not a transaction of the partnership, so the sales
price is not considered in this journal entry.