On February 28, 2022, Aris and Yang formed a partnership. The partners agreed to invest equal amounts of capital. Aris invested his proprietorship’s assets and liabilities as follows: Account Book Value Fair Value Accounts Receivable ₱72,000 ₱72,000 Allowance for Bad Debts 0 10,500 Merchandise Inventory 223,400 241,000 Prepaid Expenses 17,000 17,000 Office Equipment 459,000 276,000 Accumulated Depreciation 153,000 0 Accounts Payable 191,000 191,000 On February 28, Yang invested cash in an amount equal to the current market value of Aris’ partnership capital. Prepare the journal entries to record the partner’s initial investment in the new partnership Prepare the partnership’s statement of financial position immediately after its formation on February 28, 2022
On February 28, 2022, Aris and Yang formed a partnership. The partners agreed to invest equal amounts of capital. Aris invested his proprietorship’s assets and liabilities as follows: Account Book Value Fair Value Accounts Receivable ₱72,000 ₱72,000 Allowance for Bad Debts 0 10,500 Merchandise Inventory 223,400 241,000 Prepaid Expenses 17,000 17,000 Office Equipment 459,000 276,000 Accumulated Depreciation 153,000 0 Accounts Payable 191,000 191,000 On February 28, Yang invested cash in an amount equal to the current market value of Aris’ partnership capital. Prepare the journal entries to record the partner’s initial investment in the new partnership Prepare the partnership’s statement of financial position immediately after its formation on February 28, 2022
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
On February 28, 2022, Aris and Yang formed a
|
Account |
Book Value |
Fair Value |
|
Accounts Receivable |
₱72,000 |
₱72,000 |
|
Allowance for |
0 |
10,500 |
|
Merchandise Inventory |
223,400 |
241,000 |
|
Prepaid Expenses |
17,000 |
17,000 |
|
Office Equipment |
459,000 |
276,000 |
|
|
153,000 |
0 |
|
Accounts Payable |
191,000 |
191,000 |
On February 28, Yang invested cash in an amount equal to the current market value of Aris’ partnership capital.
- Prepare the
journal entries to record the partner’s initial investment in the new partnership - Prepare the partnership’s
statement of financial position immediately after its formation on February 28, 2022
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