Partners A and B comprise the AB partnership and each has a $90,000 capital balance. The existing partnership's assets are stated at fair value, and partners A and B share profits and losses of 40% and 60%, respectively. Partner C is admitted with a 20% ownership interest for a $40,000 direct cash payment to the current partners. If the goodwill method is employed to record partner C's admission, Partner A's capital balance after C's admission will be:
Partners A and B comprise the AB partnership and each has a $90,000 capital balance. The existing partnership's assets are stated at fair value, and partners A and B share profits and losses of 40% and 60%, respectively. Partner C is admitted with a 20% ownership interest for a $40,000 direct cash payment to the current partners. If the goodwill method is employed to record partner C's admission, Partner A's capital balance after C's admission will be:
Chapter10: Partnerships: Formation, Operation, And Basis
Section: Chapter Questions
Problem 59P
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Question
Partners A and B comprise the AB
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