Groucho,Harpo,and Chico Go into Partnership on January 1,2015

question 222

Essay

Groucho,Harpo,and Chico go into partnership on January 1,2015.Groucho contributes $90,000,Harpo $70,000,and Chico $40,000 to a business called Marx Brothers' Partnership.On a monthly basis,each partner is allocated income and is allowed to receive cash from the business in proportion to the capital they provided.Assume that Groucho receives $2,700 cash per month.
Required:
Part a.Prepare the journal entry for the initial investment.
Part b.Determine the monthly distribution amounts for each of the three partners.
Part c.Prepare the journal entry that would be made in one month for the monthly distribution.
Part d.Prepare the journal entry for the allocation of an annual net income of $84,000.For purposes of this journal entry,assume Sales Revenue totaled $116,000 and that all expenses,totaling $32,000,were recorded in a single account called Operating Expenses.
Part e.Prepare the journal entry to close the Drawings accounts at the end of the year.
Part f.Prepare a Statement of Partners' Equity (assume no additional investments made).

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Definitions:

Blocking

A learning process where the presence of an established conditioned stimulus interferes with the learning of a new conditioned stimulus.

Salience

The quality of being particularly noticeable or important; the state or condition by which something stands out from its surroundings or background in perception.

Behavioral Contrast

A phenomenon in which the rate of response varies according to a change in the reinforcement of an alternative behavior.

Counterconditioning

A behavioral therapy technique that involves teaching the subject to associate a positive response with a stimulus that previously elicited a negative response.