Floyd and Merriam share profits and losses equally. They agreed to dissolve the partnership and start a new one, admitting Ramelow for one-half share in the capital in exchange for land with a market value of $66,000. Which of the following is the correct journal entry to record the introduction of Ramelow as a partner?

Floyd and Merriam start a partnership business on June 12, 2019. Their capital account balances as of December 31, 2020 stood as follows:








Explanation: Total Capital = $51,000 + $19,000 + $66,000 =$136,000

Ramelow Capital = $136,000 / 2 = $68,000

Land debit is $66,000.

$68,000 - $66,000 = $2,000 bonus to new partner.

$2,000 bonus to new partner is distributed to old partners in 50/50 ratio.

Business

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