The post-closing trial balances of two proprietorships on January 1, 2020, are presented below.

Sorensen Company

Lucas Company

Dr.

Cr.

Dr.

Cr.

Cash

$14,000

$12,000

Accounts receivable

17,500

26,000

Allowance for doubtful accounts

$3,000

$4,400

Inventory

26,500

18,400

Equipment

45,000

29,000

Accumulated depreciationequipment

24,000

11,000

Notes payable

18,000

15,000

Accounts payable

22,000

31,000

Sorensen, capital

36,000

Lucas, capital

24,000

$103,000

$103,000

$85,400

$85,400

Sorensen and Lucas decide to form a partnership, Solu Company, with the following agreed upon valuations for noncash assets.

Sorensen Company

Lucas Company

Accounts receivable

$17,500$26,000Allowance for doubtful accounts

4,5004,000Inventory

28,00020,000Equipment

25,00015,000

All cash will be transferred to the partnership, and the partnership will assume all the liabilities of the two proprietorships.

Prepare separate journal entries to record the transfer of each proprietorship's assets and liabilities to the partnership.(Credit account titles are automatically indented when amount is entered. Do not indent manually.)

Date

Account Titles and Explanation

Debit

Credit

Jan. 1

select an account title to record the transfer of Sorensen's assets and liabilities on January 1

Allowance for Doubtful Accounts

Accounts Payable

Sorensen, Capital

Lucas, Capital

Notes Payable

Cash

Accumulated Depreciation - Equipment

Accounts Receivable

Inventory

Equipment

enter a debit amount

enter a credit amount

select an account title to record the transfer of Sorensen's assets and liabilities on January 1

Lucas, Capital

Sorensen, Capital

Cash

Accounts Receivable

Accumulated Depreciation - Equipment

Inventory

Equipment

Accounts Payable

Notes Payable

Allowance for Doubtful Accounts

enter a debit amount

enter a credit amount

select an account title to record the transfer of Sorensen's assets and liabilities on January 1

Notes Payable

Allowance for Doubtful Accounts

Accounts Receivable

Accounts Payable

Cash

Sorensen, Capital

Lucas, Capital

Accumulated Depreciation - Equipment

Equipment

Inventory

enter a debit amount

enter a credit amount

select an account title to record the transfer of Sorensen's assets and liabilities on January 1

Equipment

Lucas, Capital

Sorensen, Capital

Accounts Payable

Accumulated Depreciation - Equipment

Cash

Allowance for Doubtful Accounts

Inventory

Accounts Receivable

Notes Payable

enter a debit amount

enter a credit amount

select an account title to record the transfer of Sorensen's assets and liabilities on January 1

Allowance for Doubtful Accounts

Lucas, Capital

Sorensen, Capital

Accumulated Depreciation - Equipment

Cash

Accounts Receivable

Inventory

Notes Payable

Equipment

Accounts Payable

enter a debit amount

enter a credit amount

select an account title to record the transfer of Sorensen's assets and liabilities on January 1

Notes Payable

Accounts Payable

Lucas, Capital

Inventory

Equipment

Cash

Accumulated Depreciation - Equipment

Sorensen, Capital

Accounts Receivable

Allowance for Doubtful Accounts

enter a debit amount

enter a credit amount

select an account title to record the transfer of Sorensen's assets and liabilities on January 1

Notes Payable

Lucas, Capital

Accumulated Depreciation - Equipment

Accounts Payable

Allowance for Doubtful Accounts

Sorensen, Capital

Cash

Inventory

Accounts Receivable

Equipment

enter a debit amount

enter a credit amount

select an account title to record the transfer of Sorensen's assets and liabilities on January 1

Accounts Payable

Allowance for Doubtful Accounts

Cash

Notes Payable

Lucas, Capital

Sorensen, Capital

Accumulated Depreciation - Equipment

Accounts Receivable

Inventory

Equipment

enter a debit amount

enter a credit amount

(Transfer of Sorensen's assets and liabilities.)

Jan. 1

select an account title to record the transfer of Lucas' assets and liabilities on January 1

Sorensen, Capital

Inventory

Accounts Receivable

Equipment

Allowance for Doubtful Accounts

Notes Payable

Accounts Payable

Lucas, Capital

Accumulated Depreciation - Equipment

Cash

enter a debit amount

enter a credit amount

select an account title to record the transfer of Lucas' assets and liabilities on January 1

Equipment

Lucas, Capital

Accounts Receivable

Inventory

Allowance for Doubtful Accounts

Sorensen, Capital

Notes Payable

Accounts Payable

Accumulated Depreciation - Equipment

Cash

enter a debit amount

enter a credit amount

select an account title to record the transfer of Lucas' assets and liabilities on January 1

Lucas, Capital

Accounts Receivable

Accounts Payable

Inventory

Sorensen, Capital

Equipment

Allowance for Doubtful Accounts

Notes Payable

Accumulated Depreciation - Equipment

Cash

enter a debit amount

enter a credit amount

select an account title to record the transfer of Lucas' assets and liabilities on January 1

Inventory

Accounts Receivable

Accounts Payable

Notes Payable

Sorensen, Capital

Equipment

Accumulated Depreciation - Equipment

Cash

Lucas, Capital

Allowance for Doubtful Accounts

enter a debit amount

enter a credit amount

select an account title to record the transfer of Lucas' assets and liabilities on January 1

Accumulated Depreciation - Equipment

Cash

Accounts Receivable

Inventory

Equipment

Allowance for Doubtful Accounts

Sorensen, Capital

Notes Payable

Accounts Payable

Lucas, Capital

enter a debit amount

enter a credit amount

select an account title to record the transfer of Lucas' assets and liabilities on January 1

Accounts Payable

Accounts Receivable

Lucas, Capital

Sorensen, Capital

Accumulated Depreciation - Equipment

Allowance for Doubtful Accounts

Cash

Inventory

Equipment

Notes Payable

enter a debit amount

enter a credit amount

select an account title to record the transfer of Lucas' assets and liabilities on January 1

Accounts Payable

Notes Payable

Sorensen, Capital

Lucas, Capital

Accounts Receivable

Allowance for Doubtful Accounts

Inventory

Accumulated Depreciation - Equipment

Cash

Equipment

enter a debit amount

enter a credit amount

select an account title to record the transfer of Lucas' assets and liabilities on January 1

Sorensen, Capital

Lucas, Capital

Cash

Accounts Receivable

Inventory

Accumulated Depreciation - Equipment

Allowance for Doubtful Accounts

Equipment

Notes Payable

Accounts Payable

enter a debit amount

enter a credit amount

(Transfer of Lucas' assets and liabilities.)

Further, it is agreed that Sorensen will invest an additional $5,000in cash, and Lucas will invest an additional $19,000in cash. Journalize the additional cash investment by each partner.(Credit account titles are automatically indented when amount is entered. Do not indent manually.)

No.

Account Titles and Explanation

Debit

Credit

Jan. 1

select an account title to record Sorensen's investment on January 1

Sorensen, Capital

Notes Payable

Equipment

Allowance for Doubtful Accounts

Accounts Receivable

Inventory

Accounts Payable

Lucas, Capital

Accumulated Depreciation - Equipment

Cash

enter a debit amount

enter a credit amount

select an account title to record Sorensen's investment on January 1

Accounts Payable

Accumulated Depreciation - Equipment

Sorensen, Capital

Accounts Receivable

Lucas, Capital

Notes Payable

Cash

Inventory

Equipment

Allowance for Doubtful Accounts

enter a debit amount

enter a credit amount

(To record Sorensen's investment.)

Jan. 1

select an account title to record Lucas' investment on January 1

Lucas, Capital

Accumulated Depreciation - Equipment

Accounts Receivable

Notes Payable

Accounts Payable

Inventory

Cash

Equipment

Allowance for Doubtful Accounts

Sorensen, Capital

enter a debit amount

enter a credit amount

select an account title to record Lucas' investment on January 1

Allowance for Doubtful Accounts

Accumulated Depreciation - Equipment

Notes Payable

Accounts Payable

Equipment

Sorensen, Capital

Cash

Accounts Receivable

Lucas, Capital

Inventory

enter a debit amount

enter a credit amount

(To record Lucas' investment.)

Make a classified balance sheet for the partnership on January 1, 2020.(List Current Assets in order of liquidity.)

SOLU COMPANY

Balance Sheet

choose the accounting period

January 1, 2020

For the Year Ended January 1, 2020

For the Month Ended January 1, 2020

Assets

select an opening name for subsection one

Current Assets

Current Liabilities

Intangible Assets

Long-term Investments

Long-term Liabilities

Property, Plant and Equipment

Owners' Equity

Total Assets

Total Current Assets

Total Current Liabilities

Total Intangible Assets

Total Liabilities

Total Liabilities and Owners' Equity

Total Long-term Investments

Total Long-term Liabilities

Total Property, Plant and Equipment

Total Owners' Equity

Sorensen, Capital

Lucas, Capital

enter a balance sheet item

$enter a dollar amount

enter a balance sheet item

$enter a dollar amount

select between addition and deduction

Add

Less

:enter a balance sheet item

enter a dollar amount

enter a subtotal of the two previous amounts

enter a balance sheet item

enter a dollar amount

select a closing name for subsection one

Current Assets

Current Liabilities

Intangible Assets

Long-term Investments

Long-term Liabilities

Property, Plant and Equipment

Owners' Equity

Total Assets

Total Current Assets

Total Current Liabilities

Total Intangible Assets

Total Liabilities

Total Liabilities and Owners' Equity

Total Long-term Investments

Total Long-term Liabilities

Total Property, Plant and Equipment

Total Owners' Equity

Sorensen, Capital

Lucas, Capital

enter a total amount for subsection one

select an opening name for subsection two

Current Assets

Current Liabilities

Intangible Assets

Long-term Investments

Long-term Liabilities

Property, Plant and Equipment

Owners' Equity

Total Assets

Total Current Assets

Total Current Liabilities

Total Intangible Assets

Total Liabilities

Total Liabilities and Owners' Equity

Total Long-term Investments

Total Long-term Liabilities

Total Property, Plant and Equipment

Total Owners' Equity

Sorensen, Capital

Lucas, Capital

enter a balance sheet item

enter a dollar amount

select a closing section name for this part of the balance sheet

Current Assets

Current Liabilities

Intangible Assets

Long-term Investments

Long-term Liabilities

Property, Plant and Equipment

Owners' Equity

Total Assets

Total Current Assets

Total Current Liabilities

Total Intangible Assets

Total Liabilities

Total Liabilities and Owners' Equity

Total Long-term Investments

Total Long-term Liabilities

Total Property, Plant and Equipment

Total Owners' Equity

Sorensen, Capital

Lucas, Capital

$enter a total amount for this part of the balance sheet

Liabilities and Owners' Equity

select an opening name for subsection one

Current Assets

Current Liabilities

Intangible Assets

Long-term Investments

Long-term Liabilities

Property, Plant and Equipment

Owners' Equity

Total Assets

Total Current Assets

Total Current Liabilities

Total Intangible Assets

Total Liabilities

Total Liabilities and Owners' Equity

Total Long-term Investments

Total Long-term Liabilities

Total Property, Plant and Equipment

Total Owners' Equity

Sorensen, Capital

Lucas, Capital

enter a balance sheet item

$enter a dollar amount

enter a balance sheet item

enter a dollar amount

select a closing name for subsection one

Current Assets

Current Liabilities

Intangible Assets

Long-term Investments

Long-term Liabilities

Property, Plant and Equipment

Owners' Equity

Total Assets

Total Current Assets

Total Current Liabilities

Total Intangible Assets

Total Liabilities

Total Liabilities and Owners' Equity

Total Long-term Investments

Total Long-term Liabilities

Total Property, Plant and Equipment

Total Owners' Equity

Sorensen, Capital

Lucas, Capital

enter a total amount for subsection one

select an opening name for section two

Current Assets

Current Liabilities

Intangible Assets

Long-term Investments

Long-term Liabilities

Property, Plant and Equipment

Owners' Equity

Total Assets

Total Current Assets

Total Current Liabilities

Total Intangible Assets

Total Liabilities

Total Liabilities and Owners' Equity

Total Long-term Investments

Total Long-term Liabilities

Total Property, Plant and Equipment

Total Owners' Equity

Sorensen, Capital

Lucas, Capital

select a balance sheet item

Current Assets

Current Liabilities

Intangible Assets

Long-term Investments

Long-term Liabilities

Property, Plant and Equipment

Owners' Equity

Total Assets

Total Current Assets

Total Current Liabilities

Total Intangible Assets

Total Liabilities

Total Liabilities and Owners' Equity

Total Long-term Investments

Total Long-term Liabilities

Total Property, Plant and Equipment

Total Owners' Equity

Sorensen, Capital

Lucas, Capital

$enter a dollar amount

select a balance sheet item

Current Assets

Current Liabilities

Intangible Assets

Long-term Investments

Long-term Liabilities

Property, Plant and Equipment

Owners' Equity

Total Assets

Total Current Assets

Total Current Liabilities

Total Intangible Assets

Total Liabilities

Total Liabilities and Owners' Equity

Total Long-term Investments

Total Long-term Liabilities

Total Property, Plant and Equipment

Total Owners' Equity

Sorensen, Capital

Lucas, Capital

enter a dollar amount

select a closing name for section two

Current Assets

Current Liabilities

Intangible Assets

Long-term Investments

Long-term Liabilities

Property, Plant and Equipment

Owners' Equity

Total Assets

Total Current Assets

Total Current Liabilities

Total Intangible Assets

Total Liabilities

Total Liabilities and Owners' Equity

Total Long-term Investments

Total Long-term Liabilities

Total Property, Plant and Equipment

Total Owners' Equity

Sorensen, Capital

Lucas, Capital

enter a total amount for section two

select a closing name for this part of the balance sheet

Current Assets

Current Liabilities

Intangible Assets

Long-term Investments

Long-term Liabilities

Property, Plant and Equipment

Owners' Equity

Total Assets

Total Current Assets

Total Current Liabilities

Total Intangible Assets

Total Liabilities

Total Liabilities and Owners' Equity

Total Long-term Investments

Total Long-term Liabilities

Total Property, Plant and Equipment

Total Owners' Equity

Sorensen, Capital

Lucas, Capital

$enter a total amount for this part of the balance sheet