Mo Mulder and Molly Munchkin operate separate hobby shops. On April 8, 2021, they decide to combine their businesses, which had been operated as proprietorships, to form Mo & Molly Partnership. Information from their separate balance sheets is presented below:

		Mo's Models		Molly's Crafts
Cash		$7,000		$6,500
Accounts receivable		1,700		1,150
Allowance for doubtful accounts		300		100
Accounts payable		1,350		500
Equipment		2,100		1,000
Accumulated depreciation - equipment		700		400

It is agreed that the expected realizable value of Mos accounts receivable is $950 and Molly's receivables is $900. The fair market value of Mos equipment is $1,000 and Molly's equipment is $700. It is further agreed that the new partnership will assume all liabilities of the proprietorships.

(a)

Prepare the journal entries necessary to record the formation of the partnership. (Credit account titles are automatically indented when the amount is entered. Do not indent manually.)

Date	Account Titles and Explanation	Debit	Credit
Apr. 8, 2021	Accounts Payable Equipment Accounts Receivable M. Mulder, Capital Cash M. Munchkin, Capital Allowance for Doubtful Accounts
	M. Munchkin, Capital M. Mulder, Capital Accounts Payable Cash Equipment Accounts Receivable Allowance for Doubtful Accounts
	Accounts Payable Accounts Receivable Allowance for Doubtful Accounts M. Mulder, Capital M. Munchkin, Capital Equipment Cash
	Accounts Receivable Cash Equipment Allowance for Doubtful Accounts Accounts Payable M. Mulder, Capital M. Munchkin, Capital
	Equipment Accounts Receivable Allowance for Doubtful Accounts M. Mulder, Capital Cash M. Munchkin, Capital Accounts Payable
	M. Munchkin, Capital M. Mulder, Capital Accounts Payable Cash Accounts Receivable Equipment Allowance for Doubtful Accounts
	(To record Mo's Models)
Apr. 8, 2021	M. Mulder, Capital Accounts Receivable Allowance for Doubtful Accounts Accounts Payable M. Munchkin, Capital Cash Equipment
	M. Munchkin, Capital Allowance for Doubtful Accounts Accounts Receivable Cash Accounts Payable M. Mulder, Capital Equipment
	M. Mulder, Capital M. Munchkin, Capital Equipment Accounts Payable Cash Allowance for Doubtful Accounts Accounts Receivable
	M. Mulder, Capital M. Munchkin, Capital Allowance for Doubtful Accounts Equipment Accounts Receivable Accounts Payable Cash
	Allowance for Doubtful Accounts Equipment Accounts Payable M. Mulder, Capital M. Munchkin, Capital Cash Accounts Receivable
	Allowance for Doubtful Accounts Accounts Receivable Cash Equipment Accounts Payable M. Mulder, Capital M. Munchkin, Capital
	(To record Molly's Crafts)