Individual + Sole Prop. (Show your solutions)

Bry admits Pattie as a partner in business. Accounts in the ledger for Bry on March 28, 2019, prior to the admission of Pattie, show the following balances: Cash - 678,200 ; Accounts Receivables - 126,775 ; M. Inventory - 140,900 ; Accounts Payable - 216,565 ; Loan Payable - 291,520.

It is agreed that for purposes of establishing Pattie's interest, the following adjustments shall be made:

(a) An allowances for doubtful accounts at 20% of accounts receivables is to be established.

(b) The merchandise inventory is to be valued at 165,780.

(c) Prepaid interest expense of 56,430 and accrued salary expense of 23,400 are to be recognized Pattie is to invest sufficient cash to obtain a 3/7 interest in the partnership.

Pattie: 3/7 ; Bry: 4/7

Questions:

1.) Bry's adjusted capital before the admission of Pattie.

A.) 437,790

B.) 437,315

C.) 473,790

D.) 470,345

2.) The amount of cash investment by Pattie.

A.) 352,758.75

B.) 352,000

C.) 352,758.25

D.) 352,443