Parker and Ellis Agree to Admit Teng as a 1/3

Multiple Choice

Parker and Ellis agree to admit Teng as a 1/3 partner for $45,000 to be paid to Parker and Ellis, divided equally. Immediately prior to Teng's entry into the partnership, Parker and Ellis each had capital balances of $90,000. The journal entry to record Teng's purchase of the partnership interest is:

A) Debit Parker, Capital $30,000; debit Ellis, Capital $30,000; credit Teng, Capital $60,000.
B) Debit Cash $45,000; Debit Parker, Capital $15,000; debit Ellis, Capital $15,000; credit Teng, Capital $75,000.
C) Debit Teng, Capital $45,000; credit Parker, Capital $22,500; credit Ellis, Capital $22,500.
D) Debit Parker, Capital $22,500; debit Ellis, Capital $22,500; credit Teng, Capital $45,000.
E) Debit Teng, Capital $90,000; credit Ellis, Capital $45,000; credit Parker, Capital $45,000.