User Account

All Pages

Prepare schedule showing the changes in capital

Assignment Help Financial Accounting
Reference no: EM132721953

Razul and Amy decided to start a partnership called SA Consulting on January 1, 2020. Each of them contributed a number of items to the partnership, which are listed below. All tangible assets are listed at their market value.

Razul

Cash $40,000
Equipment 190,000
Bank Loan80,000

Amy

Cash $60,000
Furniture 70,000
Accounts Payable 30,000

  • On March 1, Razul and Amy added a new partner to the business, Sheila. Sheila will contribute $100,000 and receive a 35% share of the business. Use the capital balances from January 1 to determine any bonuses. Assume the existing partners will split any bonus evenly.

During the year, Razul and Amy withdrew $20,000 and $15,000 respectively and the business reported a net income of $400,000. Their partnership agreement provided for sharing of net income (loss) on the following basis:

1. Salary of $60,000 is allocated to Razul, $50,000 to Amy, and $20,000 to Sheila.
2. Interest is allocated at 7% of each partner's opening capital balance.
3. Remainder is shared where Razul gets 40%, Amy gets 25%, and Sheila gets 35%.

Problem a) Prepare the journal entries to record the contributions of each partner to start the partnership.

Problem b) Prepare schedule showing the changes in capital and ending capital balances after the admission of Sheila.

Problem c) Prepare the journal entry to record the admission of the new partner on March 1.

Problem d) Prepare the journal entry to record the partner withdrawals of cash.

Reference no: EM132721953

Questions Cloud

List the requirements to comply with the food act : List the requirements to comply with the Food act at state and local levels and Establish the procedures required to ensure the local government requirement
Post from the general journal to the general ledger accounts : Post from the general journal to the general ledger accounts and to the accounts payable ledger accounts. Use general ledger account numbers
Which of the amounts is closest to the present value : Which of the amounts is closest to the present value of a financial instrument that pays a 5% coupon and has a face value of $10,000.
What you choose to report on in your research report : Your hypothesis and topic determine what you choose to analyze and report on in your research report. We are starting our research NOW by developing.
Prepare schedule showing the changes in capital : Razul and Amy decided to start a partnership. Prepare schedule showing the changes in capital and ending capital balances after the admission of Sheila.
Establish comprehensive job evaluation : HR department of ABC Limited is in process of evaluating the jobs within the organization in order to ensure internal equity and designing base structure.
How much would bond sell for if interest rate eight percent : A consol is selling at $1,200 with an interest rate of 5%. How much would this bond sell for if the interest rate were 8% instead?
Prepare a schedule of accounts payable for ryan express : Ryan's Express, a retail business, had the following beginning balances and purchases - Prepare a schedule of accounts payable for Ryan's Express as of October
Determine the initial outlay of the project : Pharmos Incorporated, Determine the Net Present Value of the project and advice the company on whether to invest in the new line of product.

Reviews

Write a Review

Financial Accounting Questions & Answers

  About the average accounting performance

If a firms WACC is 6.6 percent and the average firm in its industry has an ROA of 8 percent, is this firm earning above or below normal economic performance and above or below average accounting performance?

  What is swimkids margin of safety

Swimkids is a swimsuit manufacturer. They sell swim suits at a selling price is $30 per unit. Swimkids variable costs are $18 per unit. Fixed costs are $85,000. Swimkids expects sales of $279,800 next year. What is Swimkids's margin of safety?

  Compute the adjusting entry recorded on december

Prepare the adjusting entry recorded on December 31, 2010. Prepare the entry recorded on March 1, 2011. Prepare the entry recorded on September 1, 2011.

  What is the effective or net cost of the large press

What is the effective or net cost of the large press and If this is the only way Zarin can obtain the large press, should the firm go ahead with the merger

  Prepare a sales journal and a cash receipts journal

Prepare a sales journal and a cash receipts journal. Then review the transactions of Wise Company and enter those that should be journalized in the sales journal and those that should be journalized in the cash receipts journal.

  Is this accounting for the signing bonus acceptable

A small publishing company signs an aspiring Olympic gymnast to write a book. The company pays the gymnast $500,000 to sign plus future book royalties. A note to the company's financial statements says that "prepaid expenses include $500,000 in autho..

  Amount jimmy must include in gross income

Jimmy has fallen on hard times recently. Last year he borrowed $341,000 and added an additional $91,500 of his own funds to purchase $432,500 of undeveloped real estate. For each of the following independent situations, indicate the amount Jimmy must..

  Prepare an answer sheet with column headings

All of the costs you have listed above, except one, would be differential costs between the alternatives of Staci producing pottery or staying with the aerospace company. Which cost is not differential? Explain.

  How much is the total carrying amount of the calitalized

How much is the total carrying amount of the calitalized intangibke assets at year-end? How much will be shown as intangible assets in Blair's year-end

  What the beginning cash amount must have been

During the period, cash receipts equal $124,300. If cash payments during the period total $135,100, then the beginning Cash amount must have been

  Explain the difference between profit and profitability

Explain the concept of going concern and the implication of revocation of going concern assumption when financial statements are prepared.

  Illustrate what entities or relationships most likely need

Illustrate what entities and/or relationships most likely need to be included in a query to portray the unfilled purchase orders made by each purchasing agent?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd