Question
1. R and D formed a partnership on February 10, 2020. R contributed cash of $150,000, while D contributed inventory with a fair value of
1. R and D formed a partnership on February 10, 2020. R contributed cash of $150,000, while D contributed inventory with a fair value of $120,000. Due to R's expertise in selling, D agreed that R should have 60 percent of the total capital of the partnership. R and D agreed to recognize goodwill. Give journal entries for the partnership formation
2. Luqmaan and Idris drafted a partnership agreement that lists the following assets contributed at the partnership's formation:
|
| Contributed by | |
|
| Luqmaan | Idris |
| Cash | $20,000 | $30,000 |
| Inventory | 0 | 15,000 |
| Building | 0 | 40,000 |
| Furniture & Equipment | 15,000 | 0 |
The building is subject to a mortgage of $10,000, which the partnership has assumed. The partnership agreement also specifies that profits and losses are to be distributed evenly. Give journal entries.
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Accounting Information Systems
Authors: Marshall B. Romney, Paul J. Steinbart
13th edition
978-0133428537
