Pidris and luqmann establish an equal partnership in both, Ask an Expert

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Pidris and Luqmann establish an equal partnership in both equity and profits to operate a used-furniture business under the name of Pidluqu Furniture Company. Pidris contributes furniture inventory that cost $240,000 and has fair value of $320,000. Luqmann contributions $120,000 cash and delivery trucks and equipments that coast $160,000 and have a fair value of $120,000. Assume that the initial noncash contributions of the partners are recorded at fair market value.
1. Compute the balance of each capital account under the bonus method.
2. Compute the balance of each capital account under the goodwill method.

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M91228570

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