+1-415-670-9189
info@expertsmind.com
Journalize the additional cash investment by each partner
Course:- Managerial Accounting
Reference No.:- EM13526422




Assignment Help
Expertsmind Rated 4.9 / 5 based on 47215 reviews.
Review Site
Assignment Help >> Managerial Accounting

The post-closing trial balances of two proprietorships on January 1, 2012, are presented below.



Skorr Company


Crane Company


Dr.

Cr.

Dr.

Cr.

Cash

$ 10,000


$ 8,000


Accounts receivable

18,000


30,000


Allowance for doubtful accounts


$ 2,000


$ 3,000

Inventory

35,000


20,000


Equipment

60,000


35,000


Accumulated depreciation-equipment


28,000


15,000

Notes payable


20,000



Accounts payable


30,000


40,000

Skorr, capital


43,000



Crane, capital




35,000


$123,000

$123,000

$93,000

$93,000

Skorr and Crane decide to form a partnership, Commander Company, with the following agreed upon valuations for noncash assets.


Skorr Company

Crane Company

Accounts receivable

$18,000

$30,000

Allowance for doubtful accounts

2,500

4,000

Inventory

38,000

25,000

Equipment

40,000

22,000

All cash will be transferred to the partnership, and the partnership will assume all the liabilities of the two proprietorships. Further, it is agreed that Skorr will invest an additional $3,500 in cash, and Crane will invest an additional $16,000 in cash.

Instructions

(a) Prepare separate journal entries to record the transfer of each proprietorship's assets and liabilities to the partnership.

(b) Journalize the additional cash investment by each partner.

(c) Prepare a classified balance sheet for the partnership on January 1, 2012.




Put your comment
 
Minimize


Ask Question & Get Answers from Experts
Browse some more (Managerial Accounting) Materials
List and describe other factors should be taken into consideration when deciding whether to accept a special order and except that the company is producing 40,000 units per mo
Note that under full costing, the company is showing a substantial loss in 2011. Based on the limited information available, does it appear that the company should get out of
If you live in California, the decision to buy earthquake insurance is an important one. A survey revealed that only 133 of 350 randomly selected residences in one California
Distinguish between decision making under certainty and decision making under uncertainty. To what aspects of the decision does the uncertainty refer? What other possible so
"Breakeven analysis isn't very useful to the company because companies require to do more than break even to survive in the long run." Describe why you agree or disagree wit
What will the price be if Preston follows its normal pricing policy and should Preston accept the order? Briefly, indicate factors that, while hard to quantify, should be take
In December 2012, Yerbury Company's manager estimated next year's total direct labor cost assuming 50 persons working an average of 2,000 hours each at an average wage rate of
What kind of system makes sense for your company, given that you plan to start with only one version of your product but at some point in the future may offer a variety of o