Ron Marden and Tip Baker operate separate auto repair shops. On January 1, 2020, they decide to combine their separate businesses which were operated as proprietorships to form M & B Auto Repair, a partnership. Information from their separate balance sheets is presented below:

		Marden Auto Repair		Baker Auto Repair
Cash		$10,000		$14,000
Accounts receivable		12,000		10,000
Allowance for doubtful accounts		1,000		500
Accounts payable		5,000		6,000
Notes payable				3,000
Salaries and wages payable		1,000		1,500
Equipment		12,000		24,000
Accumulated depreciationequipment		2,000		4,000

It is agreed that the expected realizable value of Mardens accounts receivable is $11,000 and Bakers receivables is $7,000. The fair value of Mardens equipment is $13,000 and the value of Bakers equipment is $20,000. It is further agreed that the new partnership will assume all liabilities of the proprietorships with the exception of the notes payable on Bakers balance sheet which he will pay himself. Prepare the journal entries necessary to record the formation of the partnership.