EXERCISE 15-8 Adjusting Entries for Partner Admission LO ('10 MP R F i ll: N SW? Bill and Jane share prots and losses in a 70:30 ratio. Mike is to be admitted into a partnership upon the investment of $14,000 for a one-third capital interest. Account balances for Bill and Jane on June 30, 2014 just before the admission of Mike are as follows: It is agreed that for purposes of establishing the interests of the former partners, the following adjustments shall be made: 1. An allowance for doubtful accounts of 2% of the accounts receivable is to be established. Debit Cash Accounts Receivable Credit Notes Receivable Merchandise Inventory 12,000 Prepaid Insurance \"Accounts Payable Bill, Capital Jane, Capital 2. The merchandise inventory is to be valued at $10,000. 3. Accrued expenses of $600 are to be recognized. ...H..I....-..:.. ..:L..I..... ....... n\"... manna... ln-laaI-MM'JAAA tumulcunun mm\" Amman \"mm/arun an