Question Help 22Gary Peter and Chris and have capital balanc

Question Help

22)Gary, Peter, and Chris and have capital balances of $26,000, $38,000, and $30,000, respectively. As per the partnership agreement, Gary gets a profit share of 2/9; Peter gets 4/9; and Chris gets 3/9. The partnership agrees to pay $20,000 as the final settlement to Gary. How much bonus does Peter receive as a result of this transaction? (Do not round intermediate calculations and round the final answer to the nearest dollar.)

A.

$2,667

B.

$2,571

C.

$3,429

D.

$3,333

23)

Harry, Tony, and Liza run a partnership firm. In the process of liquidation, the partnership sells

nonminuscash assets, having a book value of $78,000, for $86,000. Which of the following is true of the journal entries?

A.

Nonminuscash

assets will be credited for $86,000.

B.

Nonminuscash

assets will be credited for $78,000.

C.

Cash will be credited for $78,000.

D.

Cash will be credited by $8,000.

27)

The following information is from the December 31, 2018 balance sheet of Millner Corporation.

Preferred Stock, $100 par

$560,000

PaidminusIn

Parlong dash—Preferred

43,000

Common Stock, $1 par

190,000

PaidminusIn

Parlong dash—Common

510,000

Retained Earnings

191,500

Total Stockholders\' Equity

$1,494,500

What was the average issue price of the common stock shares? (Round your answer to the nearest cent.)

A.

$1.88

B.

$2.68

C.

$3.68

D.

$1.00

Question Help

Solution

Solution 22:

Gary Capital balance = $26,000

Settlement amount for Gary = $20,000

As revised profit sharing ratio of continuing partner is not available, hence continuing partner (Peter and Cheris) will share profit in their old ratio i.e. 4:3

Hence remaining balance fo Gary\'s captial for $6,000 will be distributed to Peter and Cheris in the ratio of 4:3

Peter share = $6,000*4/7 = $3,429

Chris Share = $6,000*3/7 = $2,571