E13-2 Accounting for partner investments [10 min] Nan Ferdinand has been operating a student apartment-locator service as a proprietorship. She and Misti Morris have decided to form a partnership. Ferdinand's investment consists of cash, $6000; accounts receivable, $13000; office furniture, $15000; a building, $51000; and a loan payable to the bank, $22000. To determine Nan's equity in the partnership, she and Misti hire an independent valuer. He values all the assets and liabilities at their carrying amount except the building, which has a current market value of $96000. Also, there are additional accounts payable of $5 000 that Nan will contribute. Misti will contribute cash equal to Nan's equity in the partnership.

E13-2 Accounting for partner investments [10 min] Nan Ferdinand has been operating a student apartment-locator service as a proprietorship. She and Misti Morris have decided to form a partnership. Ferdinand's investment consists of cash, $6000; accounts receivable, $13000; office furniture, $15000; a building, $51000; and a loan payable to the bank, $22000. To determine Nan's equity in the partnership, she and Misti hire an independent valuer. He values all the assets and liabilities at their carrying amount except the building, which has a current market value of $96000. Also, there are additional accounts payable of $5 000 that Nan will contribute. Misti will contribute cash equal to Nan's equity in the partnership.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

E12-15 Nan Fuentes has been operating an apartment-locator service as a prietorship. She and Misti Fulmer have decided to form a partnershi Fuentes's investment consists of cash, $8,000; accounts receivabie $10,000; furniture, $1,000; a building, $55,000; and a note payable. $10,000. To determine Funtes's equity in the partnership, she and Fulmer hime an independent appraiser. The appraiser values all the assets and liabi ties at their book value except the building, which has a current marka value of $90,000. Also there are accounts payable of $3,000. Requirement Make the entry on the partnership books to record Fuentes's investment (pр. 600-601)
Important Note! Before you start working on this problem, watch the Hint video. This video shows you exactly how to work this problem. Moss and Barber organize a partnership on January 1. Moss's initial net investment is $79,000, consisting of cash ($21,000), equipment ($73,000), and a note payable reflecting a bank loan for the new business ($15,000). Barber's initial investment is cash of $35,000. Prepare journal entries to record (1) Moss's investment and (2) Barber's investment. No A B Transaction (1) (2) Cash Equipment Note payable Moss, Capital Cash Barber, Capital Answer is not complete. General Journal 0000 30 Debit Credit
Sandra and Kelsey are forming a partnership. Sandra will invest a piece of equipment with a book value of $4,900 and a fair market value of $16,500. Kelsey will invest a building with a book value of $35,500 and a fair market value of $76,900. What amount will be recorded to Sandra's capital account? Oa. $35,500 Ob. $16,500 O c. $76,900 O d. $4,900
Required information Important Note! Before you start working on this problem, watch the Hint video. This video shows you exactly how to work this problem. [The following information applies to the questions displayed below.] ** Ramer and Knox began a partnership by investing $68,000 and $102,000, respectively. During its first year, the partnership earned $205,000. Prepare calculations showing how the $205,000 income is allocated under each separate plan for sharing Income and loss. Important Notel Before you start working on this problem, watch the Hint video. This video shows you exactly how to work this problem. 1. The partners did not agree on a plan, and therefore share Income equally Ramer Knox Show Transcribed Text
(2) Example 3 (Equity: Business Ownership): Hanna, Ursula, Thomas and Günther engage in a partnership named "Chick Enterprise. // Chick generates a net income of 75.000 $. 1) Ursula, Thomas and Günther get salary allowances for thei extra professional service for At clients, as follows: 12.000$ for Ursula; 9.000 $ for Thomas and 3.000 for Günther respectively. 11) Average capital balances during the year are as follows: Hanna Ursula Thomas Gunther 42.000 $ 4.200 $ 12.600 $ 25.200 $ Partners agreed for a 7.25 interest allowance for each partner at the end of the year. 84.000 $ [II) After salary & interest allowances, the remainder will be allocated from a fixed ratio of [5:2:4:1] for [Hanna: Ursula: Thomas: Günther Find each partner's capital (equity) and do the closing entry Example 4 (Equity: Business Ownership): Royal Inc. posesses a capital structure as follows: Luis 20 Hector 10 Sanchez 10 (in.000 $) 2) On March 1, Luis decides to sell 10 $ of his share to Martin. 3) On May 1,…
PROBLEM RECOGNITION TASK Determine the maximum deposit insurance coverage by PDIC in the following items. 5. Ronel is a partner of MW Partnership and a stockholder of LG Corporation. He has the following deposit accounts in a closed bank: Ronel’s business (sole proprietorship) P350,000 Ronel’s personal savings account P500,000 Ronel and Jhun and Eff and Karla P600,000 Ronel and MW Partnership P650,000 Ronel and LG Corporation P400,000 What is the maximum deposit insurance coverage as far as Ronel is concerned?
2. Hailley and Indie formed a partnership, with capital contributions, as follows: Hailley- Cash of P1,350,000 Indie -Equipment with an agreed value of P 1,500,000 Give the journal entry. Description P.R. Debit Credit
Sandra and Kelsey are forming a partnership. Sandra will invest a piece of equipment with a book value of $4,700 and a fair market value of $12,600. Kelsey will invest a building with a book value of $37,400 and a fair market value of $64,500.What amount will be recorded to the building account? a.$12,600 b.$64,500 c.$4,700 d.$37,400
1. 2. EXERCISE 4. Journal Entries - Cash, non-cash, and industry contributions. Prepare and upload the journal entries to record contributions of Kim and Krislam into the partnership under the following independent assumptions: 3. Page 4. 9 Cash contribution amounting to P45,000 each. Kim contributed P35,000 cash and a store equipment with carrying value of $27,000. Krislam contributed P15,000 cash and a delivery vehicle with a fair market value of P195,000. Kim and Krislam agreed that each depreciable asset is overvalued by $4,000. Kim contributed P10,000 cash and furniture and fixtures with carrying value of P32,000. Krislam contributed P5,000 cash and a building with a fair market value of P295,000 and an unpaid mortgage of P27,500. Kim and Krislam agreed that building is undervalued by P9,000. Kim contributed P25,000 cash, a store equipment with fair market value of P47,000, and delivery vehicle with a fair market value of P175,000. Krislam, an industrial partner, was to contribute…
Sandra and Kelsey are forming a partnership. Sandra will invest a piece of equipment with a book value of $6,600 and a fair market value of $13,400. Kelsey will invest a building with a book value of $32,700 and a fair market value of $63,400. What amount will be recorded to Kelsey's capital account? a. $32,700 b. $63,400 c. $13,400 d. $6,600
150 against Joint Venture. Beena received ? 8,00,000 of sale proceeds from Chandni who is ai oreign and paid the due amount to Reena through a bank draft. Fass necessary journal entries and open necessary accounts in the books of Reena and becha. Ans. Profit 7 2,37,750; Final remittance ? 5,09,625 8. JA and B enter into a Joint Venture to take a building contract for ? 2,40,000. They provide the following information regarding the expenditure incurred by them : FINANCIAL ACCOUNTING Preparation of 12. A, B and 7 60,000, bought goe sold Materials Cement Wages Architect Fee Licence Fees sales. The necessary Ans. Profi 000'89 000'ET 000'L 13. X, Y and Plant 000'0 Plant was valued at ? 10,000 at the end of the contract and B agreed to take it at that value. Contract amount of 7 2,40,000 was received by A. Show : (i) Joint Venture Account and B's Account in books of A; and (ii) Joint Venture Account and A's Account in books of B. they inve Account. to the ce 000'0 000° L7 000's 000'0 charged…
EXERCISE 6. Journal Entries - Capital share different from capital contribution. On June 1, 2022, Al and Ace formed a partnership. Al contributed cash of P600,000, inventories of P100,000, and furniture and fixtures of P120,000. On the other hand, Ace contributed cash of P520,000, building of P330,000, and land of P200,000. The building was mortgaged for a loan amounting to P500,000 of which 70% had already been paid. The remaining balance would be assumed by the partnership. The partners agreed to share profits and losses equally. Prepare and upload journal entries related to partnership formation, assuming: 1. Each partner would be credited for the full amount of net assets invested 2. Each partner initially should have equal interest in partnership capital. To ensure this, it was agreed that partner with a lower capital balance had to invest additional cash.