Question
Alex and Liam decide on a partnership structure for their new business and the partnership is formed on 1 November 2019. Alex contributes cash of
Alex and Liam decide on a partnership structure for their new business and the partnership is formed on 1 November 2019.
Alex contributes cash of $23,000 and inventory with a market value of $97,000 to the partnership. Liam, who had previously been operating as a sole trader, contributes assets and liabilities to the partnership at agreed market valuations as shown below:
| Book Value in Liam's Records | Agreed Market Value | |
| Cash | $27,000 | $27,000 |
| Inventory | $76,000 | $81,000 |
| Equipment | $49,000 | $43,000 |
| Accounts Receivable | $36,000 | $30,000 |
Prepare the appropriate General Journal entries to set up the on 1 November 2019.
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Horngrens Financial And Managerial Accounting The Financial Chapters
Authors: Tracie L. Miller Nobles, Brenda L. Mattison, Ella Mae Matsumura
6th Edition
978-0134486840, 134486838, 134486854, 134486846, 9780134486833, 978-0134486857
