Financial Accounting

Thandie and Marco are partners with capital balances of $60,000. They share profits and losses at 50%. Chris contributes $90,000 to the partnership for a 1/3 share. What amount should the partnership record as an individual bonus to each of the old partners? $10,000 $7,000 $3,000 $20,000

NOT: 20,000

Thandie and Marco are partners with capital balances of $60,000. They share profits and losses at 50%. Chris contributes $30,000 to the partnership for a 1/3 share. What amount should Thandie's capital balance in the partnership be? $60,000 $50,000 $45,000 $30,000

NOT: 30,000 NOT: 45,000

A well written partnership agreement should include each of the following except ________. how to settle disputes the name of the partnership division of responsibilities Partner's individual tax rate

Partner's individual tax rate

Any assets invested by a particular partner in a partnership ________. do not become a partnership asset but instead remain with the partner can be used only by the investing partner become the property of all the partners are the basis for all profit sharing

become the property of all the partners

A partnership ________. has one owner can issue stock pays taxes on partnership income can have more than one general partner

can have more than one general partner

Prior to proceeding with the liquidation, the partnership should ________. prepare adjusting entries without closing complete the accounting cycle for final operational period prepare only closing entries complete financial statements only

complete the accounting cycle for final operational period

When a partnership dissolves, the last step in the dissolution process is to ________. allocate the gain or loss on sale based on income sharing ratio pay off liabilities sell noncash assets divide the remaining cash among the partners

divide the remaining cash among the partners

Which of the following is a disadvantage of the partnership form of organization? limited life no taxation at the partnership level flexibility in business operations combining of financial resources

limited life

What type of assets may a partner not contribute to a partnership? accounts receivable furniture equipment personal credit cards

personal credit cards

When a partnership dissolves, the first step in the dissolution process is to ________. allocate the gain or loss on sale based on income sharing ratio pay off liabilities sell noncash assets divide the remaining cash among the partners

sell noncash assets

How does a newly formed partnership handle the contribution of previously depreciated assets? continues the depreciation life as if the owner had not changed starts over, using the contributed value as the new cost basis shortens the useful life of the asset per the partnership agreement does not depreciate the contributed asset

starts over, using the contributed value as the new cost basis

Which one of the following would not be considered in the development of a partnership agreement? profit and loss levels processing disputes stock options asset contributions

stock options

Mutual agency is defined as: a mutual agreement the right of all partners to represent the company's normal business operations a synonym for partnership a partnership between two partnerships

the right of all partners to represent the company's normal business operations

Thandie and Marco are partners with capital balances of $60,000. They share profits and losses at 50%. Chris contributes $60,000 to the partnership for a 1/3 share. What amount should the partnership record as an individual bonus to each of the old partners? $10,000 $7,000 $0 $5,000

$0

Juan contributes marketable securities to a partnership. The book value of the securities is $7,000 and they have a current market value of $10,000. What amount should the partnership record in Juan's Capital account due to this contribution? $10,000 $7,000 $3,000 none of the above

$10,000

Thandie and Marco are partners with capital balances of $60,000. They share profits and losses at 50% each. Chris contributes $30,000 to the partnership for a 1/3 share. What amount should the partnership record as a bonus to Chris? $20,000 $15,000 $10.500 $5,000

$20,000

Chani contributes equipment to a partnership that she purchased 2 years ago for $10,000. The current book value is $7,500 and the market value is $9,000. At what value should the partnership record the equipment? $10,000 $9,000 $7,500 none of the above

$9,000