Admission/Withdrawal of PartnersMerrill, Lynch, and Pierce are partners with current capital balances of $10,000, $15,00...

Get help with any kind of assignment - from a high school essay to a PhD dissertation

  1. Order Custom Essay, Course Work, Research and Term Papers

Merrill, Lynch, and Pierce are partners with current

April 14, 2018

Admission/Withdrawal of Partners

Merrill, Lynch, and Pierce are partners with current capital balances of $10,000, $15,000, and
$5,000, respectively. The profit and loss sharing ratio is 1:2:3, respectively. Consider each of
the following situations independently. (That is, for each case assume the data shown above).
Be sure to show your work. Do not try to cram all of your work in the space below – use
additional sheets of paper (or you may complete in Excel or Word).
CASE A: Suppose Fenner is admitted to the partnership and given a 25% share of ownership
in exchange for a cash contribution of $10,000? What will Fenner’s capital account balance be?
$_______________

CASE B: Suppose Smith is admitted to the partnership and given a 20% share of ownership in
exchange for a cash contribution of $10,000? What will Lynch’s capital balance be?
$_________________

CASE C: Suppose Fenner is admitted to the partnership with a 10% share of ownership in
exchange for an $8,000 contribution? What will Pierce’s capital balance be?
$__________________

CASE D: Suppose Merrill withdraws from the partnership. He takes $15,000 in full settlement
of his equity. What will the capital account balance of Lynch be?
$___________________

CASE E: Suppose that the partnership is to be liquidated because Pierce is personally
bankrupt. Assume there is a loss on conversion of non-cash assets to cash of $12,000. What
will be the amount of cash that Merrill will receive from the partnership in liquidation? Complete
a schedule of cash payments to arrive at your final answer.
$______________________

CASE F: Fenner paid $8,000 to Merrill for one-half of Merrill’s partnership interest. What is
Fenner’s capital account balance after the payment?
$_______________________
Profit and Loss Allocation

Tinker, Evers and Chance operate a sports partnership. Their capital balances are $20,000,
$5,000, and $8,000 respectively. Profits and losses are allocated on a basis that includes
interest on capital balances, salaries, and the remainder in a fixed ratio. In each independent
case below, determine the allocation of income to each partner. Show your work (the best way
to complete each case is to use a net income schedule illustrated in your textbook). Do not try
to cram all of your work in the space below – use additional sheets of paper (or you may
complete in Excel or Word).

CASE A: Net income: $60,000; Interest on capital balances 6%; Salaries: Tinker $8,000,
Evers $6,000, Chance $4,000; Fixed Ratio: Tinker 60%, Evers 20%, Chance 20%

CASE B: Net income: $90,000; Interest on capital balances 15%; Salaries: Tinker $10,000,
Evers $4,000, Chance $14,000; Fixed Ratio: Tinker 30%, Evers 30%, Chance 40%

CASE C: Net loss: ($10,000); Interest on capital balances 10%; Salaries: Tinker $6,000,
Evers $9,000, Chance $7,000; Fixed Ratio: Tinker 10%, Evers 50%, Chance 40%










OUR SERVICE CHARTER






  • Professional Academic Writers

    An academic degree is one of the qualifications that our writers hold. This is only a minimum requirement that we ask from our writers, but the team also has writers who possess higher educational credentials. It means that the team comprises of competent writers who have gone through institutions of higher learning and passed their exams. Subsequently, the writers have a good grasp of what our clients require. It is notable that our writers not only want to apply their acquired knowledge, but they are also willing to help our clients to outperform them. This is a clear indication of a team that is willing to walk an extra mile. We uphold professionalism in our operations, and our clients should look forward to receive services from a team of experts. It is the spirit of value addition that makes us to scale any heights in order to deliver and outperform our clients’ expectations.

  • Free Revisions

    The papers that we deliver usually reflect a high quality level. However, there is always a room for any additional fine-tuning touch in line with a client’s preference without any additional charges. To begin with, a client has discretion to make a choice on their preferred top writer from our team. Such a writer could have handled past work for the client and received a positive review from the same. It means that the client has confidence of the quality of service that the writer delivers. Secondly, a client has an option of making use of our editing services. Our editors are always on standby to revise the paper and ensure that it matches with the expectations of a client that the instruction brief had detailed. The revision covers content adjustment that removes off-topic details, addition of sources, removal of language style errors, and assessment of the referencing style in order to enhance compliance.

  • 100% Plagiarism-Free Guarantee

    We deliver top-quality essays through employing various measures that seek to improve the content of a given assignment. One of the quality-control systems that we use entails plagiarism checkers. These systems help us to deliver a 100% plagiarism-free papers to our clients. We also value the originality of papers, and we do not resell any submitted paper. It means that every client always gets a unique paper. Additionally, our perfect team of writers is usually keen on the academic writing standards as well as the instructions brief that a client submits. Our team of writers holds matchless competence when it comes to its service delivery. Every member of the team usually has an academic degree, and the team’s diversified skills make it possible for us to have a qualified writer in any client’s area of study. Additionally, our past clients have always given a positive feedback on each of our writers.

  • 100% Confidentiality

    We mind about the interests of our clients holistically. It is for this reason that we maintain high-level confidentiality in regard to our clients’ personal information. Importantly, we use the information for purposes that relate with our services only. The only information that we require relates to our clients’ writing needs. It is also important to note that our clients’ payment information is secure with us. If there is any query in regard to the payment information, then our support team is always willing to provide any clarifications in a prompt manner. Confidentiality extends to the fact that a client made use of our services. It means that we hold our relationship with our clients in secrecy. Importantly, our confidentiality measures beat any advanced security measure that can identify any information regarding our relationship with our clients. It means that our clients transact with us freely without any fear of information leakage.




Related Questions