The statement of members’ equity for Aztec Mines, LLC, is shown at the top of the following page.
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Aztec Mines, LLC |
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Statement of Members’ Equity |
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For the Years Ended December 31, 2007 and 2008 |
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Utah |
Aztec |
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Properties, |
Holdings, |
Cleveland |
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LLC, |
Ltd., |
Porter, |
Total |
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Member |
Member |
Member |
Members’ |
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Equity |
Equity |
Equity |
Equity |
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Members’ equity, January 1, 2007 |
$460,000 |
$310,000 |
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$ 770,000 |
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Net income |
70,000 |
210,000 |
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280,000 |
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Members’ equity, December 31, 2007 |
$530,000 |
$520,000 |
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$1,050,000 |
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Porter contribution |
5,000 |
15,000 |
$267,500 |
287,500 |
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Net income |
78,400 |
254,800 |
58,800 |
392,000 |
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Less member withdrawals |
(32,000) |
(48,000) |
(50,000) |
(130,000) |
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Members’ equity, December 31, 2008 |
$581,400 |
$741,800 |
$276,300 |
$1,599,500 |
a. What was the income sharing ratio in 2007?
b. What was the income sharing ratio in 2008?
c. How much cash did Cleveland Porter contribute to Aztec Mines, LLC, for his interest?
d. Why do the member equity accounts of Utah Properties, LLC, and Aztec Holdings, Ltd., have positive entries for Cleveland Porter’s contribution?
e. What percentage interest of Aztec Mines did Cleveland Porter acquire?