Question - Blue and Green Partnership has partner capital account balances as follows:
Blue, Capital $550,000 Green, Capital 250,000
The partners share income and losses in the ratio of 60% to Blue and 40% to Green.
Prepare the journal entry on the books of the parnership to record the admission of Yellow as a new partner under the following two independent circumstances.
1. Yellow pays $350,000 to Blue and $150,000 to Green for one-half of each of their ownership interest in a personal transaction.
2. Yellow invests $850,000 in the partnership for a one-third interest in partnership capital.