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The ABC Partnership has 3 equal partners with the following capital accounts




Question;Problem;A;1) The ABC Partnership has 3;equal partners with the following capital accounts;a. Partner;A capital account $100,000;b. Partner B capital account $100,000;c. Partner C capital account $100,000;They are allowing Partner D to become an equal (1/4) partner;for a contribution of $300,000;a) Prepare the journal entry;if the partnership uses the bonus method;b) Prepare the journal entry;if the partnership uses the goodwill method;2) Alpha and Beta are equal partners. At the beginning of the year Alpha has $600,000;in his capital account while Beta has $900,000 in her partnership account. The partnership agreement states that;partners get 10% interest on their capital accounts and that Alpha gets a $40,000;salary for work done for the partnership. Any remaining profits or losses are;equally divided between the partners.;Income before interest and Alpha?s salary was $375,000. Determine the ending capital balance for;Alpha and Beta.;Problem B;1) On January 1, 2011 The ACME Company made two;investments;a. Purchased 2000 of the;2,000,000 shares of HAL for $200,000.;b. Purchased 400 of the 1000;shares of GZK for $40,000 at this time the book value of GZK was $100,000.;In 2011 HAL;paid dividends of $4,000,000, reported income of $12,000,000. On December 31, HAL stock was selling for;$104 per share.;In 2011 GZK;paid dividends of $8000, reported income of $2800. On December 31, GZK stock was selling for $98;per share.;On 3/1/12 ACME;sold its investment in HAL at $102 per share;On 3/14/12;ACME sold its investment in GZK at $101 per share;REQUIRED;Prepare the;journal entries needed by ACME in 2011 and 2012 if?. They have no influence;over HAL and they have significant influence of GZK;Note: ACME is a manufacturer so they would use;available for sale rather than trading securities.;2) On January 1, 2011 Big;Company purchased 80% of Small company for $3,000,000. On January 1, Small had the following balance;sheet;Assets;Cash 500,000;Inventory 500,000;Equipment 2,000,000;a/d equipment 1,000,000;liabilities;accounts payable 200,000;equity;common stock;1,000,000;retained;earnings 800,000;The equipment;with a 10 year life (no salvage) has a;fair market value of $1,600,000;On January 1;2011 (just before the purchase) Big had the following balance sheet;Cash $4,000,000;Equipment;$5,000,000;a/d;equipment $3,000,000;land $3,000,000;a/p 1,000,000;common stock;1,000,000;r/e 7,000,000;REQUIRED: PREPARE THE CONSOLIDATED BALANCE SHEET ON;JANUARY 2, 2011;Problem C;1) On January 1, 2005 Able;Company purchased all of the stock of Baker Company. On January 1, 2010, Able purchased a piece of;equipment for $100,000. This equipment is expected to last 8 years with $4000;salvage. On January 1, 2011 Able sold;the equipment to Baker for $80,000.;Baker believes the equipment has 7 remaining years and a 3000;salvage. On January 1, 2013 Baker sold;the equipment to Cat company for $45,000.;REQUIRED: PREPARE THE JOURNAL ENTRIES FOR ABLE, BAKER;AND CONSOLIDATED FOR 2011, 2012, AND 2013?LABEL WHOSE BOOKS THE ENTRIES ARE;BEING MADE ON;3) On 1/1/2000 Crazy Company purchased all the outstanding;stock of Normal Company. On 10/1/2011;Crazy sold inventory to Normal for $60,000.;This merchandise had cost Crazy $20,000 to produce. At the end of 2011 Normal had sold ? of the;merchandise from Crazy for $42,000. In;2012 Normal sold the rest of the merchandise from Crazy for $43,000.;REQUIRED: PREPARE THE JOURNAL ENTRIES FOR CRAZY;NORMAL AND WORKSHEET FOR 2011, 2012?BOTH;CRAZY AND NORMAL USE PERPETUAL INVENTORY.


Paper#44498 | Written in 18-Jul-2015

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