On March 1, 20Y8, Eric Keene and Renee Wallace form a partnership. Keene agrees to invest $23,400 in cash and merchandise inventory valued at $62,600. Wallace invests certain business assets at valuations agreed upon, transfers business liabilities, and contributes sufficient cash to bring her total capital to $60,000. Details regarding the book values of the business assets and liabilities, and the agreed valuations, follow:

The partnership agreement includes the following provisions regarding the division of net income: interest on original investments at 10%, salary allowances of $19,000 (Keene) and $24,000 (Wallace), and the remainder equally.

1.Calculate the net asset value of each partner's initial investment in the newly formed firm. Please Show your work and explain your answer. In your answer make sure to summarize relevant GAAP.

Agreed-Upon Valuation $19,500 1,400 Accounts Receivable Allowance for Doubtful Accounts Equipment Accumulated Depreciation-Equipment Accounts Payable Notes Payable (current) Wallace's Ledger Balance $19,900 1,200 83,500 29,800 15,000 37,500 55,400 15,000 37,500