A summary balance sheet for the Akerly, Baskin, and Crow partnership on December 31, 2014 is shown below. Partners Akerly, Baskin, and Crow allocate profit and loss in their respective ratios of 3:2:1. The partnership agreed to pay partner Baskin $500,000 for his partnership interest upon his retirement from the partnership on January 1, 2015. The partnership financials on January 1, 2015 are:
Required:
Prepare the journal entry to reflect Baskin's retirement from the partnership:
1. Assuming a bonus to Baskin.
2. Assuming a revaluation of total partnership capital based on excess payment.
3. Assuming goodwill equal to the excess payment is recorded.
Definitions:
Beta Waves
Brainwave patterns associated with active, alert consciousness and cognitive engagement.
Suprachiasmatic Nucleus
A region of the brain in the hypothalamus responsible for controlling circadian rhythms.
Pineal Gland
A small endocrine gland in the brain that produces melatonin, a hormone that regulates sleep-wake cycles and seasonal biological rhythms.
Biological Clock
An internal mechanism that regulates bodily rhythms and cycles, such as sleep and wakefulness, over approximately a 24-hour period.
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