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On February 1, 2023, Tessa Williams and Audrey Xie formed a partnership in Ontario. Williams contributed $88,000 cash and Xie contributed land valued at $128,000 and a small building valued at $188,000. Also, the partnership assumed responsibility for Xie's $138,000 long-term note payable associated with the land and building. The partners agreed to share profit or loss as follows: Williams is to receive an annual salary allowance of $98,000, both are to receive an annual interest allowance of 12% of their original capital investments, and any remaining profit or loss is to be shared equally. On November 20, 2023, Williams withdrew cash of $68,000 and Xie withdrew $53,000. After the adjusting entries and the closing entries to the revenue and expense accounts, the Income Summary account had a credit balance of $168,000. Required: 1. Present general journal entries to record the initial capital investments of the partners, their cash withdrawals, and the December 31 f the Income Summary and withdrawals accounts.

On February 1, 2023, Tessa Williams and Audrey Xie formed a partnership in Ontario. Williams contributed $88,000 cash and Xie contributed land valued at $128,000 and a small building valued at $188,000. Also, the partnership assumed responsibility for Xie's $138,000 long-term note payable associated with the land and building. The partners agreed to share profit or loss as follows: Williams is to receive an annual salary allowance of $98,000, both are to receive an annual interest allowance of 12% of their original capital investments, and any remaining profit or loss is to be shared equally. On November 20, 2023, Williams withdrew cash of $68,000 and Xie withdrew $53,000. After the adjusting entries and the closing entries to the revenue and expense accounts, the Income Summary account had a credit balance of $168,000. Required: 1. Present general journal entries to record the initial capital investments of the partners, their cash withdrawals, and the December 31 f the Income Summary and withdrawals accounts.

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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Cc. 187.

On February 1, 2023, Tessa Williams and Audrey Xie formed a partnership in Ontario. Williams contributed $88,000 cash and Xle contributed land valued at $128,000 and a small building valued at $188,000. Also, the partnership assumed responsibility for Xie's $138,000 long-term note payable associated with the land and building. The partners agreed to share profit or loss as follows: Williams is to receive an annual salary allowance of $98,000, both are to receive an annual interest allowance of 12% of their original capital investments, and any remaining profit or loss is to be shared equally. On November 20, 2023, Williams withdrew cash of $68,000 and Xie withdrew $53,000. After the adjusting entries and the closing entries to the revenue and expense accounts, the Income Summary account had a credit balance of $168,000. Required: 1. Present general journal entries to record the initial capital investments of the partners, their cash withdrawals, and the December 31 closing of the Income Summary and withdrawals accounts. View transaction list Journal entry worksheet < 1 2 Record the initial capital investments. Note: Enter debits before credits. Date February 01, 2023 February 01, 2023 3 4 Record entry Capital account balances. General Journal Clear entry Williams Debit Xie Credit 2. Determine the balances of the partners' capital accounts as of the end of 2023. > < Prev 6 of 10 ⠀ Next > View general journal
Transcribed Image Text:On February 1, 2023, Tessa Williams and Audrey Xie formed a partnership in Ontario. Williams contributed $88,000 cash and Xle contributed land valued at $128,000 and a small building valued at $188,000. Also, the partnership assumed responsibility for Xie's $138,000 long-term note payable associated with the land and building. The partners agreed to share profit or loss as follows: Williams is to receive an annual salary allowance of $98,000, both are to receive an annual interest allowance of 12% of their original capital investments, and any remaining profit or loss is to be shared equally. On November 20, 2023, Williams withdrew cash of $68,000 and Xie withdrew $53,000. After the adjusting entries and the closing entries to the revenue and expense accounts, the Income Summary account had a credit balance of $168,000. Required: 1. Present general journal entries to record the initial capital investments of the partners, their cash withdrawals, and the December 31 closing of the Income Summary and withdrawals accounts. View transaction list Journal entry worksheet < 1 2 Record the initial capital investments. Note: Enter debits before credits. Date February 01, 2023 February 01, 2023 3 4 Record entry Capital account balances. General Journal Clear entry Williams Debit Xie Credit 2. Determine the balances of the partners' capital accounts as of the end of 2023. > < Prev 6 of 10 ⠀ Next > View general journal
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