Sasha and Michelle form a partnership. Sasha contributes $13,000 cash and merchandise inventory with a current market value of $3,000. While journalizing this transaction OA. Merchandise Inventory will be credited for $3,000 B. Merchandise Inventory will be credited for $2,200 OC. Merchandise Inventory will be debited for $2,200 D. Merchandise Inventory will be debited for $3,000

Sasha and Michelle form a partnership. Sasha contributes $13,000 cash and merchandise inventory with a current market value of $3,000. While journalizing this transaction OA. Merchandise Inventory will be credited for $3,000 B. Merchandise Inventory will be credited for $2,200 OC. Merchandise Inventory will be debited for $2,200 D. Merchandise Inventory will be debited for $3,000

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

Sasha and Michelle form a partnership. Sasha contributes $13,000 cash and merchandise inventory with a current
market value of $3,000. While journalizing this transaction
OA. Merchandise Inventory will be credited for $3,000
B. Merchandise Inventory will be credited for $2,200
OC. Merchandise Inventory will be debited for $2,200
OD. Merchandise Inventory will be debited for $3,000

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