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The partnership of Carr, Eddy, and Howe had total capital of $1,140,000 on December 31,...

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Accounting

The partnership of Carr, Eddy, and Howe had total capital of $1,140,000 on December 31, 2011, as follows: Carr, Capital (30%) $360,000 Eddy, Capital (45%) 510,000 Howe, Capital (25%) 270,000 Total $1,140,000

Profit and loss sharing percentages are shown in parentheses. Assume that Klein became a partner by investing $300,000 in the Carr, Eddy, and Howe partnership for a 25 percent interest in the capital and profits, and the partnership assets are revalued. Under this assumption (Please show work)

a. Kleins capital credit will be $300,000. b. Carrs capital will be increased to $394,000. c. total partnership capital after Kleins admission to the partnership will be $1,200,000. d. net assets of the partnership will increase by $380,000 including Klein interest.

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