1. On April 1 Marcy agrees to sell $100,000 of her partnership interest to Jamie
ID: 2748563 • Letter: 1
Question
1. On April 1 Marcy agrees to sell $100,000 of her partnership interest to Jamie for $120,000. Please record the journal entry for this transaction. Date Debit Credit 2. Which would be a benefit to a partnership it they decided to incorporate their business? A Limited Liability B Ease of Capital accumulation C Taxation D. Both A and B 3. Sun and Moon, LLP's equity section of the balance sheet shows the following information: Capital, Sun 50,000 Capital, Moon 75,000 Net Income 165,000 If the partnership does not have an agreement, how will net income be split between the partners? (answers on next page) A Net Income will be retained by the partnership B Net income will be split based on the partners captial balances C Net income will be split evenly between partners D The partners will only receive a salary 1. On April 1 Marcy agrees to sell $100,000 of her partnership interest to Jamie for $120,000. Please record the journal entry for this transaction. Date Debit Credit 2. Which would be a benefit to a partnership it they decided to incorporate their business? A Limited Liability B Ease of Capital accumulation C Taxation D. Both A and B 3. Sun and Moon, LLP's equity section of the balance sheet shows the following information: Capital, Sun 50,000 Capital, Moon 75,000 Net Income 165,000 If the partnership does not have an agreement, how will net income be split between the partners? (answers on next page) A Net Income will be retained by the partnership B Net income will be split based on the partners captial balances C Net income will be split evenly between partners D The partners will only receive a salaryExplanation / Answer
1) Marcy capital Debit 100,000
Jamie capital credit 100,000
[being sell of share recorded]
2)correct option is "D" -Both a and b
3)correct option is "C" -Net income will be split evenly between partners
In absence of agreement between partners ,profit or losses are shared equally.
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