Partnership - Formation & Organisation In the 1" of January 2020, A, B and C conducted an agreement to form a partnership titled ABC Trading & Shipping. Ltd. Total capital of the company is $ 300,000 divided equally. Each partner offers his share as follows: Partner (A): paid all his contribution in cash. Partner (B): offers his contribution in Kind as follows: Land S 50,000 Furniture 20,000 and inventory 40,000 Partner (C): gives up his proprietorship for the new partnership. The last balance sheet of the proprietorship was as follows: Current assets: Cash Accounts receivables Inventory 10,000 20,000 30,000 Short term liabilities: Accounts payable Short term loan 26.000 14,000 60.000 Owners' equity Fixed Assets Land Machinery& Equipment Furniture 90.000 24.000 36,000 10.000 Total Liabilities & Owners' equity 70.000 Total Assets 130.000 130.000 (i) If you learn that the partners agree on current fair value of nonmonetary assets at the time of their investment and that the assets are recognized in the accounting records at such values. Required: 1- To prepare the journal entries in the partnership records. The partners (B) and (C) paid or received the difference in cash. 2. Prepare the partnership's balance sheet just after the formation in this case. (ii) In the previous case, if you learn that the partners did not agree on values of nonmonetary assets at the time of their investment and they considered the difference as intangible asset or as reserves. Required: 1. To prepare the journal entries in the partnership records in this case. 2- prepare the partnership's balance sheet just after the formation in the previous case Show transcribed image text