Musa Moshref and Shaniqua Hollins have operated a successful firm for many years, sharing net income and net losses equally Taylor Anderson is to be admitted to the partnership on July 1 of the current year, in accordance with the following agreement a Assets and liabilities of the old partnership are to be valued at their book values as of June 30, except for the following Accounts receivable amounting to $2,700 are to be written off, and the allowance for doubtful accounts is to be increased to 5 of the remaining accounts Merchandise inventory is to be valued at $77,300 Equipment is to be valued at $156,500 b Anderson is to purchase $70,800 of the ownership interest of Hollins for $75,000 cash and to contribute another $44,900 cash to the partnership for a total ownership equity of $115,700 The post closing trial balance of Moshref and Hollins as of June 30 is as follows Required 1 Journalize the entries as of June 30 to record the revaluations, using a temporary account entitled Asset Revaluations The balance in the accumulated depreciation account is to be eliminated After journalizing the revaluations, close the balance of the asset revaluations account to the capital accounts of Musa Moshref and Shaniqua Hollins 2 Journalize the additional entries to record Andersons entrance to the partnership on July 1, 2016 Refer to the Chart of Accounts for exact wording of account titles 3 Present a balance sheet for the new partnership as of July 1, 2016 Refer to the information given and the list of Labels and Amount Descriptions provided for the exact wording of the answer choices for text entries POST CLOSING TRIAL BALANCE June 30, 2016 ACCOUNT TITLE DEBIT CREDIT 1 Cash 8,000 00 2Accounts Receivable 42,400 00 1,785 00 Allowance for Doubtful Accounts Merchandise Inventory Prepaid Insurance 71,900 00 2,800 00 180,600 00 6Equipment 7Accumulated Depreciation Equipment 8 Accounts Payable Notes Payable (current) 0 Musa Moshref, Capital 1 Shaniqua Hollins, Capital 2 Totals 42,800 00 20,300 00 34,000 00 122,515 00 84,300 00 305,700 00 305,700 00

The Answer is in the image, click to view ...

Answered step by step

Verified Expert Solution

Link Copied!

Question

1 Approved Answer

Posted on Aug 17, 2024

Musa Moshref and Shaniqua Hollins have operated a successful firm for many years, sharing net income and net losses equally. Taylor Anderson is to be

Musa Moshref and Shaniqua Hollins have operated a successful firm for many years, sharing net income and net losses equally. Taylor Anderson is to be admitted to the partnership on July 1 of the current year, in accordance with the following agreement:

Assets and liabilities of the old partnership are to be valued at their book values as of June 30, except for the following:

	Accounts receivable amounting to $2,700 are to be written off, and the allowance for doubtful accounts is to be increased to 5% of the remaining accounts.
	Merchandise inventory is to be valued at $77,300.
	Equipment is to be valued at $156,500.

Anderson is to purchase $70,800 of the ownership interest of Hollins for $75,000 cash and to contribute another $44,900 cash to the partnership for a total ownership equity of $115,700.

The post-closing trial balance of Moshref and Hollins as of June 30 is as follows:

image text in transcribed

Required:
1.	Journalize the entries as of June 30 to record the revaluations, using a temporary account entitled Asset Revaluations. The balance in the accumulated depreciation account is to be eliminated. After journalizing the revaluations, close the balance of the asset revaluations account to the capital accounts of Musa Moshref and Shaniqua Hollins.
2.	Journalize the additional entries to record Andersons entrance to the partnership on July 1, 2016. Refer to the Chart of Accounts for exact wording of account titles.
3.	Present a balance sheet for the new partnership as of July 1, 2016. Refer to the information given and the list of Labels and Amount Descriptions provided for the exact wording of the answer choices for text entries.

POST-CLOSING TRIAL BALANCE June 30, 2016 ACCOUNT TITLE DEBIT CREDIT 1 Cash 8,000.00 2Accounts Receivable 42,400.00 1,785.00 Allowance for Doubtful Accounts Merchandise Inventory Prepaid Insurance 71,900.00 2,800.00 180,600.00 6Equipment 7Accumulated Depreciation-Equipment 8 Accounts Payable Notes Payable (current) 0 Musa Moshref, Capital 1 Shaniqua Hollins, Capital 2 Totals 42,800.00 20,300.00 34,000.00 122,515.00 84,300.00 305,700.00 305,700.00