At April 30, partners’ capital balances in PDL Company are G. Donley

At April 30, partners’ capital balances in PDL Company are G. Donley $51,000, C. Lamar $46,000, and J. Pinkston $17,200. The income sharing ratios are 5 : 4 : 1, respectively. On May 1, the PDLT Company is formed by admitting J. Terrell to the firm as a partner.

Journalize the admission of Terrell under each of the following independent assumptions. (Credit account titles are automatically indented when amount is entered. Do not indent manually. Round answers to 0 decimal places, e.g. 5,275.)

(1) Terrell purchases 50% of Pinkston’s ownership interest by paying Pinkston $15,200 in cash.

(2) Terrell purchases 331/3% of Lamar’s ownership interest by paying Lamar $14,600 in cash.

(3) Terrell invests $62,000 for a 30% ownership interest, and bonuses are given to the old partners.

(4) Terrell invests $42,200 for a 30% ownership interest, which includes a bonus to the new partner.

Here’s the SOLUTION

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