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Megan and Patrick agree to combine their businesses to form a Partnership on 8 February 2021. The fair value and carrying amounts of the assets and the liabilities contributed by each partner to the partnership are as follows: Megan Patrick Carrying amount Fair value Carrying amount Fair value

Megan and Patrick agree to combine their businesses to form a Partnership on 8 February 2021. The fair value and carrying amounts of the assets and the liabilities contributed by each partner to the partnership are as follows: Megan Patrick Carrying amount Fair value Carrying amount Fair value

FINANCIAL ACCOUNTING
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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Question 5 Accounting for partnerships -Part A Megan and Patrick agree to combine their businesses to form a Partnership on 8 February 2021. The fair values and carrying amounts of the assets and the liabilities contributed by each partner to the partnership are as follows: Megan Patrick Carrying amount Fair value Carrying amount Fair value Cash at bank 180,000 180,000 225,000 225,000 Inventory 172,500 165,000 127,500 120,000 Land 675,000 705,000 390,000 405,000 Machine 390,000 300,000 Accumulated Depreciation - Machine 60,000 Accounts payable 135,000 135,000 75,000 75,000 Mortgage loan 150,000 150,000 Required Prepare the general journal entries to record the formation of the Partnership of Megan & Patrick on 8
Transcribed Image Text:Question 5 Accounting for partnerships -Part A Megan and Patrick agree to combine their businesses to form a Partnership on 8 February 2021. The fair values and carrying amounts of the assets and the liabilities contributed by each partner to the partnership are as follows: Megan Patrick Carrying amount Fair value Carrying amount Fair value Cash at bank 180,000 180,000 225,000 225,000 Inventory 172,500 165,000 127,500 120,000 Land 675,000 705,000 390,000 405,000 Machine 390,000 300,000 Accumulated Depreciation - Machine 60,000 Accounts payable 135,000 135,000 75,000 75,000 Mortgage loan 150,000 150,000 Required Prepare the general journal entries to record the formation of the Partnership of Megan & Patrick on 8
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