NEIUACTG 324 Homework assignment 4: Dissolution of partnership
Due date: See the announcement on the D2L
Name:
.
Note: This homework assignment accounts for 6 points. No point will be given when (1) it
is incomplete, (2) it is past due, (3) no work is provided, or (4) most answer/work is
incorrect. Points will be deducted if part of the answer/work provided is incorrect.
April, May, and June have the following capital balances: $40,000, $75,000 and $65,000
respectively. The partners share profits and losses 20%, 40%, and 40% respectively. Consider
the following five independent transactions:
a. May retires and is paid $93,000 based on the terms of the original partnership agreement. If
the bonus method is used, what is the capital balance of April?
Answer:
b. May retires and is paid $93,000 based on an independent appraisal of the business. If the
goodwill method is used, what is the capital balance of April?
Answer:
c. The three partners agree to admit March for a 20% interest. March contributes $30,000 to the
partnership. If the bonus method is used, what is the capital balance of April?
Answer:
d. The three partners agree to admit March for a 20% interest. March contributes $67,000 to the
partnership. If the bonus method is used, what is the capital balance of April?
Answer:
e. The three partners agree to admit March for a 20% interest. March contributes $42,000 to the
partnership. If the goodwill method is used, what is the amount of goodwill being recorded?
Answer:
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