Alert Medical, LLC, consists of two doctors, Abrams andLipscomb, who share in all income and losses according to a 2:3income-sharing ratio. Dr. Lin has been asked to join the LLC. Priorto admitting Lin, the assets of Alert Medical were revalued toreflect their current market values. The revaluation resulted inmedical equipment being increased by $40,000. Prior to therevaluation, the equity balances for Abrams and Lipscomb were$154,000 and $208,000, respectively.
a. Provide the journal entry for the assetrevaluation. For a compound transaction, if an amount box does notrequire an entry, leave it blank.
| Medical Equipment | | |
| Abrams, Member Equity | | |
| Lipscomb, MemberEquity | | |
b. Provide the journal entry for the bonusunder the following independent situations:
1. Lin purchased a 30% interest in AlertMedical, LLC, for $228,000. For a compound transaction, if anamount box does not require an entry, leave it blank.
2. Lin purchased a 25% interest in AlertMedical, LLC, for $124,000. For a compound transaction, if anamount box does not require an entry, leave it blank.
