Ray and John operated a sports equipment company. Their profit and loss ratio was $3$:$2$ respectively. Because the business was growing, they decided to incorporate and invited Zen, Pick and Will to join them. The RJ Inc. was authorized to issue $25,000$ shares of $$100$ par value common stock with Ray and John investing their business except for the accounts receivable. Merchandise is to be written down to $$825,000$ and the furniture and equipment to $$250,000.$ The partners will be issued shares of stock at par. The balance sheet of the partnership consisted of:

Assets

Cash $$535,000$

Accounts Receivable $65,000$

Merchandise $850,000$

Furniture & Equipment $300,000$

Liabilities & Partners$$ Equity

Accounts Payable $$75,000$

Ray, Capital $950,000$

John, Capital $725,000$

Required: Determine the amount and number of shares each partner will receive. $($with solutions$)$

a$)$ Write down the assets and decrease capital:

b$)$ Divide adjusted capital by the par value