Conway and Lawrence form a partnership by combining the assets and liabilities of their respective sole proprietorships.

Requirements:

Review assets and liabilities of each partner and their market values in the following Excel Template, then:

1. 1. Journalize the formation of the partnership. Refer to Module 09 Partnership Formation tab to help with this requirement.

Half way through the first year of operations Conway and Lawrence admit Korman to the partnership.

1. 1. Journalize Korman's admission to the partnership. Refer to Module 09 Partnership Admission tab to help with this requirement.
   2. Prepare an income distribution worksheet. Refer to Module 09 Dividing Income Between Partners tab to help with this requirement.
   3. Journalize the closing of the income summary accounts to the capital accounts.

After five years of operation Conway, Korma, and Lawrence decide to dissolve their partnership.

1. 1. Complete the liquidating worksheet. Refer to Module 09 Dissolving a Partnership tab to help with this requirement.
   2. Journalize each step of the liquidation. Refer to Module 09 Dissolving a Partnership tab to help with this requirement.

Module 9 Assignment: Conway and Lawrence form a partnership by combining the assets and liabilities of their respective sole proprietorships. The following are the assets and liabilities of each partner and their market values. Asset Cash Accounts receivable Note payable Inventory Conway Book value $20,000 $5,000 $10,000 $25,000 Market value Asset Cash Equipmnet Accumulated Depreciation Accounts Payable $3,000 $28,000 Lawrence Book Value $10,000 $50,000 $15,000 $7,000 Market value $30,000 Requirements: 1 Journalize the formation of the partnership. Journal Accounts Debit Credit Half way through the first year of operations Conway and Lawrence admit Korman to the partnership. Korman buys a 1/2 share for $37,000 in cash. 2 Journalize Korman's admission to the partnership. Journal Accounts Debit Credit The net income for the first year of oprations was $50,000. After giving Conway a salary of $20,000, the rest of the net income is split evenly among the partners. 3 Prepare an income distribution worksheet. Income Distribution Conway 4 Net Income Lawrence Korman $50,000 Journalize the closing of the income summary accounts to the capital accounts. Journal Accounts Debit Credit After 5 years of operation Conway, Korma, and Lawrence decide to dissolve their partnership. The following are the account balances before liquidation begins: Cash Equipment Note Payable Capital, Conway Capital,Korman Capital, Lawrence 5 127,000 20,000 The equipment is sold for $8,000 6,000 65,000 40,000 36,000 Complete the liquidating worksheet. Cash 6 Equipment Liquidation Note payable Journalize each step of the closing. Journal Accounts Debit Credit Conway Korman Lawrence