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  • Problem V

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    Vivienne Rozenn Layto
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    1) The document describes 6 problems involving different partnership capital accounting methods. 2) The problems calculate capital balances and distributions for partners named Moore, Brown, and Coss using either a Bonus Method or Goodwill Method. 3) The Bonus Method distributes profits based on original capital contributions, while the Goodwill Method accounts for goodwill value and distributes based on total capital including goodwill.

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    1) The document describes 6 problems involving different partnership capital accounting methods. 2) The problems calculate capital balances and distributions for partners named Moore, Brown, and Coss using either a Bonus Method or Goodwill Method. 3) The Bonus Method distributes profits based on original capital contributions, while the Goodwill Method accounts for goodwill value and distributes based on total capital including goodwill.

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    5 views2 pages

    Problem V

    Uploaded by

    Vivienne Rozenn Layto
    1) The document describes 6 problems involving different partnership capital accounting methods. 2) The problems calculate capital balances and distributions for partners named Moore, Brown, and Coss using either a Bonus Method or Goodwill Method. 3) The Bonus Method distributes profits based on original capital contributions, while the Goodwill Method accounts for goodwill value and distributes based on total capital including goodwill.

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    of 2

    PROBLEM V

    1) Bonus Method
    Cash 90,000 (180,000 + 90,000) x 1/3 = 90,000
    Moore, Capital 90,000

    2) Bonus Method
    Cash 120,000 15,000 x .60 = 9,000
    Brown, Capital 9,000 15,000 x .40 = 6,000
    Coss, Capital 6,000
    Moore, Capital 135,000 (180,000 + 120,000) x .45 = 135,000

    3) Goodwill Method
    Goodwill 60,000 120,000 ÷ 1/3 = 360,000
    Brown, Capital 36,000 180,000 + 120,000 = 300,000
    Coss, Capital 24,000 60,000

    Cash 120,000 60,000 x .60 = 36,000


    Moore, Capital 120,000 60,000 x .40 = 24,000

    4) Bonus Method
    Cash 40,000 15,000 x .60 = 9,000
    Brown, Capital 9,000 15,000 x .40 = 6,000
    Coss, Capital 6,000
    Moore, Capital 55,000 (180,000 + 40,000) 1/4 = 55,000

    5) Goodwill Method
    Cash 35,000 225,000
    Goodwill 10,000 180,000 + 35,000 = 215,000
    Moore, Capital 45,000 10,000

    6) Bonus Method
    Land 150,000 40,000 x .60 = 24,000
    Brown, Capital 24,000 40,000 x .40 = 16,000
    Coss, Capital 16,000
    Moore, Capital 110,000 (180,000 + 150,000) 1/3 = 110,000

    Goodwill Method
    Goodwill 120,000 150,000 ÷ 1/3 = 450,000
    Brown, Capital 72,000 180,000 + 150,000 = 330,000
    Coss, Capital 48,000 120,000

    Land 150,000 120,000 x .60 = 72,000


    Moore, Capital 150,000 120,000 x .40 = 48,000

    7) Bonus Method
    Brown, Capital 27,600 92,000 x .30 = 27,600
    Coss, Capital 26,400 88,000 x .30 = 26,400
    Moore, Capital 54,000

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