Mike Derr and Mark Finger form a partnership by combining assets of their separate businesses. The followingbalance sheet is from Derr’s sole proprietorship. The market value of Derr’s equipment is $5,000and the market value of land is $8,000. Prepare the partnership’s journal entry to record Derr’s investment. Balance SheetAssetsLiabilitlesCash...$ 1,000Accounts payable.$ 4,500Supplies..3,000Notes payable.3,100Equipment...$11,000Total liabilities.7,600Accumulated depreciation-Equip....(9,000)2,0004,000$10,000EquityM. Derr, Capital.....Total liabilities and equity.Land....2,400$10,000Total assets.

Partnership: It is a type of business form. Under this business form, two or more individuals…

Answered: Balance Sheet Assets Liabilitles…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Mike Derr and Mark Finger form a partnership by combining assets of their separate businesses. The following
balance sheet is from Derr’s sole proprietorship. The market value of Derr’s equipment is $5,000
and the market value of land is $8,000. Prepare the partnership’s journal entry to record Derr’s investment.

Balance Sheet
Assets
Liabilitles
Cash...
$ 1,000
Accounts payable.
$ 4,500
Supplies..
3,000
Notes payable.
3,100
Equipment...
$11,000
Total liabilities.
7,600
Accumulated depreciation-Equip....
(9,000)
2,000
4,000
$10,000
Equity
M. Derr, Capital.....
Total liabilities and equity.
Land....
2,400
$10,000
Total assets.

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