Compare and contrast the Bonus method and Goodwill method of in admitting a new partner to a partnership
What will be an ideal response?
The primary differences in the two methods involve:
1 . Bonus method general involves the book value method
2 . Increases in the value of assets should not be recognized until they are realized through subsequent exchanges
3 . A write down be recognized
4 . The fair value of the incoming partner be calculated
Goodwill method
1 . Recognizes the book value of the previous partnership
2 . Records unrecognized appreciation or depreciation on recorded net assets
3 . Unrecognized Goodwill traceable to the original partnership
4 . Fair value of the new partnership
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Bill and Jan are reviewing their current financial plan. They have decided that it is time obtain life insurance and begin contributing to an investment fund for college. Bill and Jan are
A) a young, dual-income couple with no children. B) young and single. C) a young couple with children under the age of 18. D) an older couple with no dependent children living at home.
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Indicate whether the statement is true or false.