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The capital accounts of the Lee, Monroe and Newport partnership at December 31, 2018, together with...

The capital accounts of the Lee, Monroe and Newport partnership at December 31, 2018, together with profit and loss sharing ratios are as follows:

                        Lee (20%)                    130,000

                        Monroe (30%)              200,000

                        Newport (50%)            170,000

The partners agree to admit Olson into the partnership.

REQUIRED: Prepare the journal entry or entries to admit Olson into the partnership under each of the following independent assumptions.

  1. Monroe and Newport sell 30% of each of their interests to Olson for $120,000 paid directly to Monroe and Newport.
  2. Olson invests $120,000 cash in the partnership for a 25% interest in capital and profits and the partnership assets are not revalued.
  3. Same situation as Number 2 except partnership assets are revalued.
  4. Olson invests $100,000 cash in the partnership for a 15% interest in the capital and profits and partnership assets are revalued.

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ekkarill92 answered 2 years ago
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