Prepare journal entry to record the admission of new partner


Response to the following problem:

The Treed Partnership has total partners' equity of $510,000, which is made up of Elm, Capital, $400,000, and Oak, Capital, $110,000. The partners share net income and loss in a ratio of 80% to Elm and 20% to Oak. On November 1, Ash is admitted to the partnership and given a 15% interest in equity and a 15% share in any income and loss.

Prepare the journal entry to record the admission of Ash under each of the following separate assumptions: Ash invests cash of (1) $90,000; (2) $125,000; and (3) $60,000.

 

 

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Accounting Basics: Prepare journal entry to record the admission of new partner
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