Crosby and Malkin Sell to Staal a 1/3 Interest in the Crosby-Malkin

question 97

Multiple Choice

Crosby and Malkin sell to Staal a 1/3 interest in the Crosby-Malkin partnership. Staal will pay Crosby and Malkin each $60,000 for admission into the organization. Before this transaction, Crosby and Malkin show capital balances of $45,000 each. The journal entry to record the admission of Staal will

• A) show a debit to Cash of $120,000.
• B) not show a debit to Cash.
• C) show a debit to Malkin, Capital for $60,000.
• D) show a credit to Staal, Capital for $120,000.

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