Question

129. Masters, Hardy, and Rowen are dissolving their partnership. Their partnership agreement allocates income and losses equally among the partners. The current period's ending capital account balances are Masters, $16,300, Hardy, $16,300, Rowen, $(3,300). After all the assets are sold and liabilities are paid, but before any contributions to cover any deficiencies, there is $29,300 in cash to be distributed. Rowen pays $3,300 to cover the deficiency in his account. The general journal entry to record the final distribution would be:

• Debit Masters, Capital $14,650; debit Hardy, Capital $14,650; credit Cash $29,300.

• Debit Masters, Capital $9,766; debit Hardy, Capital $9,767; debit Rowen, Capital $9,767; credit Cash $29,300.

• Debit Cash $29,300; debit Rowen, Capital $3,300; credit Masters, Capital $16,300; credit Hardy, Capital $16,300.

• Debit Masters, Capital $16,300; debit Hardy, Capital $16,300; credit Rowen, Capital $3,300; credit Cash $29,300.

• Debit Masters, Capital $16,300; debit Hardy, Capital $16,300; credit Cash $32,600.

130. Cox, North, and Lee form a partnership. Cox contributes $204,000, North contributes $170,000, and Lee contributes $306,000. Their partnership agreement calls for a 6% interest allowance on the partner's capital balances with the remaining income or loss to be allocated equally. If the partnership reports income of $208,800 for its first year, what amount of income is credited to Lee's capital account?

• $74,360.

• $69,600.

• $66,200.

• $68,240.

• $56,000.

138. On January 1 of Year 1, Congo Express Airways issued $3,500,000 of 7% bonds that pay interest semiannually on January 1 and July 1. The bond issue price is $3,197,389 and the market rate of interest for similar bonds is 8%. The bond premium or discount is being amortized at a rate of $10,087 every six months. After accruing interest at year end, the company's December 31, Year 1 balance sheet should reflect total liabilities associated with the bond issue in the amount of:

• $3,340,063.

• $3,780,000.

• $3,782,437.

• $3,217,563.

• $3,902,500.

144. Caitlin, Chris, and Molly are partners and share income and losses in a 3:4:3 ratio. The partnership’s capital balances are Caitlin, $140,000; Chris, $100,000; and Molly, $120,000. Paul is admitted to the partnership on July 1 with a 20% equity and invests $180,000. The balance in Paul’s capital account immediately after his admission is:

• $108,000

• $72,000

• $360,000

• $540,000

• $180,000

Answer 1

Answer :-

129 ):-

The answer is last Option .

Debit Masters, Capital $16,300; debit Hardy, Capital $16,300; credit Cash $32,600

Explanation :-

Particulars	Debit	Credit
Capital account balances are Masters	$16,300
Capital account balances are Hardy	$16,300
Cash [ $16,300 + $16,300 ]		$32,600

130 ) :-

The answer is first Option . $74,360

Explanation :-

Particulars	Amount
Total income	$208,800
Interest on Capital	= [ $204,000 + $170,000 + $306,000 ] * 6% = $680,000 * 6% = $40,800
Balance income	= $208,800 - $40,800 = $168,000
Share in profit	= $168,000 / 3 = $56,000
Interest allowance for Lee	= $306,000 * 6% = $18,360
Total share of Lee	= $18,360 + $56,000 = $74,360

138 ) ;-

Particulars	Amount
Interest for the whole year	= $3,500,000 × 8% = $3,500,000 * 0.08 = $280,000
Total liabilities	= $3,500,000 + $280,000 = $3,780,000

So ,

The answer is second Option . $3,780,000

144 ) :-

Particulars	Amount
Total Capital of 3 partners before admission	= $140,000 + $100,000 + $120,000 = $360,000
Capital contribute of new partner	$180,000
New partner capital	= [ $360,000 + $180,000 ] * 20% = $540,000 * 20% = $108,000

So ,

The answer is first Option . $108,000