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Hillary hornes is admitted to the partnership of reagan & navon. prior to her admission, the partnership books show Georgia Reagan's capital balance at $150,000 and Carlos Navon's at $75,000. Assume Reagan and Navon share profits and losses equally.
Requirements:
1. Compute each partner's equity on the books of the new partnership under the following plans: a. hornes pays $105,000 for Navon's equity. Hornes pays Navon directly. b. homes contributes $75,000 to acquire a 1/4 interest in the partnership. c. Hornes contributes $110,000 to acquire a 1/4 interest in the partnership.
2. Journalize the entries for admitting the new partner under plans a,b, and c. Begin by computing the partners equity on the books of the new partnership under the following plans.
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