Beard,Tanner,Williams Are Operating as a Partnership

question 29

Essay

Beard,Tanner,Williams are operating as a partnership.The capital account balances at December 31,2010 are $254,000,$195,000 and $286,000 respectively.Record the entries for the following independent situations.
A.The partners vote to admit Sturges.She is going to invest $150,000 for a 15% interest in the partnership.Profit and losses are split equally between the existing partners.
B.Sturges agrees to buy 50% of Williams interest by paying him $150,000 directly.
C.The partners need new ideas and agree to give Sturges a 20% interest in exchange for $150,000.Profits and losses are shared equally between the existing partners.
D.Williams wants to retire and is willing to leave the partnership in exchange for $281,000.Profits and losses were shared on the ratio of 2:3:5.

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Definitions:

Processing Department

A unit within a manufacturing facility where a specific type of production activity takes place.

Journal Entry

A record of the financial transactions entered into the accounting ledger of a business.

Production Process

The series of steps or actions taken to convert raw materials into finished goods or services.

Units Started

The number of units of product that have entered the production process but may not yet be completed.