Ex. 15-8.1. Bad Debt Expense180.00Allowance for Doubtful Accounts 180.00 2. Unrealized lost on Revaluation of Inventory2,000.00Inventory2,000.00

3. Operating Expenses600.00Accrued Expenses 600.00

4. Insurance Expense200.00Prepaid Insurance200.00

5. Total capital ($14,000/ (1/3)) $42,000 Less Capital ($12,000 + 8,000 + 14,000) -2,980))(31,020) Goodwill$10,980

Goodwill10,980Bill, Capital (70%)7,686Jane, Capital (30%)3,294Cash14,000Mike, Capital14,000

Ex. 15-9.1. Beth, Capital$265,000 Steph, Capital 215,000 Linda, Capital 120,000 Total capital 600,000Percentage after Mary X 5/6 Total new capital 720,000 Marys contribution X 1/6Marys contributions $120,000Cash120,000Mary Capital120,000

2. Beth, Capital$265,000 Steph, Capital 215,000 Linda, Capital 120,000 Mary Investment 160,000 Total new Capital 760,000 Marys Portion (1/5)X .20 Mary, Capital$152,000

Cash160,000Mary, Capital152,000Beth, Capital (40%) 3,200Steph, Capital (40%) 3,200Linda, Capital (20%) 1,600

3. Beth, Capital$265,000 Steph, Capital 215,000 Linda, Capital 120,000 Mary Investment 160,000 Total new Capital 760,000 Marys Portion (1/4)X .25 Mary, Capital$190,000

Cash160,000Beth, Capital (40%) 12,000Steph, Capital (40%) 12,000Linda, Capital (20%) 8,000Mary, Capital190,000

Goodwill Method:Cash160,000Goodwill 30,000Mary. Capital190,000

4. Beth, Capital$265,000 Steph, Capital 215,000 Linda, Capital 120,000 Mary Investment 160,000 Total new Capital 760,000 Marys Portion (40%)X .40 Mary, Capital$304,000

Cash160,000Beth, Capital (40%) 57,600Steph, Capital (40%) 57,600Linda, Capital (20%) 28,800Mary, Capital304,000

Goodwill Method:Cash160,000Goodwill144,000Mary. Capital304,000

Ex. 15-11.

1. C 2. E3. D4 A5. B6. C