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LDG, PG and AG are partners in G’s Garage. On March 31st, LDG’s capital is $174,000,...

LDG, PG and AG are partners in G’s Garage. On March 31st, LDG’s capital is $174,000, PG - $142,000 and AG $84,000. The income sharing ratio is the last three digits of your student number - exclude any zeros and go to the next value in the student number. For example, a student number n01200474 would be on a 4:7:4 basis and someone who has n01288400 would need to be 8:8:4 basis. If you select any other numbers for the ratio – not your own student number, you will earn zero on this question in full. SG was admitted to the partnership on April 1st by admitting him to the business as a partner with twenty percent equity. Address the following scenarios – a) SG decides to invest $105,000; b) SG decides to put in $140,000, and c) SG decides to invest $60,000. Journalize accordingly



Income share ratio is 5:9:3

Solutions

Expert Solution

Solution:

Journal Entries

Scenario 1: When SG decides to invest $ 1,05,000

Scenario 2: When SG decides to invest $ 1,40,000

Scenario 3: When SG decides to invest $ 60,000

Working Notes:

ekkarill92 answered 3 years ago
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