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On January 1, 2020, Jack Skilling, Kenneth Lay, and Andy Fastow formed a partnership by contributing $40,000 in cash, $65,000 of equipment, and a delivery
On January 1, 2020, Jack Skilling, Kenneth Lay, and Andy Fastow formed a partnership by contributing $40,000 in cash, $65,000 of equipment, and a delivery van worth $30,000 respectively. The partners agreed to share the profits and losses as follows: Lay and Fastow were to receive an annual salary allowance of $25 000 each and the remaining profit or loss was to be shared 5 : 2 : 3. On December 31, 2020, the partnerships first year-end, the Income Summary account had a debit balance of $25 000.
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