Draper and Becker decide to organize a partnership. Draper invests $35,500 cash, and Becker contributes $5,300 and equipment having a book value of $7,000 and a fair value of $15,000. Prepare the entry to record each partner's investment. (Credit account titles are automatically Indented when the amount is entered. Do not Indent manually List all debit entries before credlt entrles.) Account Titles and Expl

Draper and Becker decide to organize a partnership. Draper invests $35,500 cash, and Becker contributes $5,300 and equipment having a book value of $7,000 and a fair value of $15,000. Prepare the entry to record each partner's investment. (Credit account titles are automatically Indented when the amount is entered. Do not Indent manually List all debit entries before credlt entrles.) Account Titles and Expl

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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Concept explainers

Partnership Accounting

A partnership is a kind of arrangement between two or more people whereby they agree to manage the business operations and share its profits and losses in an agreed ratio between them. The agreement that is drafted and signed by the partners of the firm is termed as partnership deed and contains various important clauses agreed between the partners such as profit/loss sharing, interest on capital, remuneration allocation of each partner, drawings, admission of a new partner, etc.

Partner Admission and Withdrawal

A partnership is a kind of arrangement between two or more people whereby they agree to manage the business operations and share its profits and losses in an agreed ratio between them. The agreement that is drafted and signed by the partners of the firm is termed as a partnership deed and contains various important clauses agreed between the partners such as profit/loss sharing, interest on capital, remuneration allocation of each partner, drawings of a partner, etc.

Question

Draper and Becker decide to organize a partnership. Draper invests $35,500 cash, and Becker contributes $5,300 and equipment
having a book value of $7,000 and a fair value of $15,000,
Prepare the entry to record each partner's investment. (Credit account titles are automatically Indented when the amount Is entered. Do not
Indent manually List all debit entries before credlt entrles.)
Account Titles and Explanation
Debit
Credit
(To record Draper's investment)
(To record Becker's investment)

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