Recording Partner's Original Investment Vanessa Kaiser and Mariah Newman decide to form a partnership by combining the assets of their separate businesses. Kaiser contributes the following assets to the partnership: cash, $19,820; accounts receivable with a face amount of $208,110 and an allowance for doubtful accounts of $7,510; merchandise inventory with a cost of $80,520; and equipment with a cost of $155,210 and accumulated depreciation of $100,890. The partners agree that $9,160 of the accounts receivable are completely worthless and are not to be accepted by the partnership, that $15,610 is a reasonable allowance for the uncollectibility of the remaining accounts, that the merchandise inventory is to be recorded at the current market price of $75,690, and that the equipment is to be valued at $68,440. Journalize the partnership's entry to record Kaiser's investment. If an amount box does not require an entry, leave it blank. Accounts Payable Allowance for Doubtful Accounts Cash Vanessa Kaiser, Capital Vanessa Kaiser, Drawing

Recording Partner's Original Investment Vanessa Kaiser and Mariah Newman decide to form a partnership by combining the assets of their separate businesses. Kaiser contributes the following assets to the partnership: cash, $19,820; accounts receivable with a face amount of $208,110 and an allowance for doubtful accounts of $7,510; merchandise inventory with a cost of $80,520; and equipment with a cost of $155,210 and accumulated depreciation of $100,890. The partners agree that $9,160 of the accounts receivable are completely worthless and are not to be accepted by the partnership, that $15,610 is a reasonable allowance for the uncollectibility of the remaining accounts, that the merchandise inventory is to be recorded at the current market price of $75,690, and that the equipment is to be valued at $68,440. Journalize the partnership's entry to record Kaiser's investment. If an amount box does not require an entry, leave it blank. Accounts Payable Allowance for Doubtful Accounts Cash Vanessa Kaiser, Capital Vanessa Kaiser, Drawing

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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Dividing Partnership Income Black and Shannon have decided to form a partnership. They have agreed that Black is to invest $255,000 and that Shannon is to invest $85,000. Black is to devote one-half time to the business, and Shannon is to devote full time. The following plans for the division of income are being considered: Equal division. In the ratio of original investments. In the ratio of time devoted to the business. Interest of 5% on original investments and the remainder equally. Interest of 5% on original investments, salary allowances of $50,000 to Black and $75,000 to Shannon, and the remainder equally. Plan (e), except that Shannon is also to be allowed a bonus equal to 20% of the amount by which net income exceeds the total salary allowances. Required: For each plan, determine the division of the net income under each of the following assumptions: (1) net income of $157,000 and (2) net income of $215,000. Round answers to the nearest whole dollar. (1) (2)…
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Dividing Partnership Income Morrison and Greene have decided to form a partnership. They have agreed that Morrison is to invest $279,000 and that Greene is to invest $93,000. Morrison is to devote one-half time to the business, and Greene is to devote full time. The following plans for the division of income are being considered: Equal division. In the ratio of original investments. In the ratio of time devoted to the business. Interest of 5% on original investments and the remainder equally Interest of 5% on original investments, salary allowances of $60,000 to Morrison and $90,000 to Greene, and the remainder equally Plan (e), except that Greene is also to be allowed a bonus equal to 20% of the amount by which net income exceeds the total salary allowances Required: For each plan, determine the division of the net income under each of the following assumptions: (1) net income of $175,000 and (2) net income of $245,000. Round answers to the nearest whole dollar. (1) (2)…
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