Question

Jesse and Tim form a partnership by combining the assets of their separate businesses. Jesse contributes accounts receivable with a face amount of $46,000 and equipment with a cost of $180,000 and accumulated depreciation of $97,000. The partners agree that the equipment is to be valued at $67,600, that $3,400 of the accounts receivable are completely worthless and are not to be accepted by the partnership, and that $1,900 is a reasonable allowance for the uncollectibility of the remaining accounts receivable. Tim contributes cash of $21,500 and merchandise inventory of $44,500. The partners agree that the merchandise inventory is to be valued at $48,000.

Journalize the entries to record in the partnership accounts (a) Jesse's investment and (b) Tim's investment. If an amount box does not require an entry, leave it blank.

(a)		fill in the blank 2	fill in the blank 3
		fill in the blank 5	fill in the blank 6
		fill in the blank 8	fill in the blank 9
		fill in the blank 11	fill in the blank 12
(b)		fill in the blank 14	fill in the blank 15
		fill in the blank 17	fill in the blank 18
		fill in the blank 20	fill in the blank 21

Answer 1

Journal entries
S.no.	Accounts title and explanations		Debit $	Credit $
a.	Accounts receivable (46000-3400)		42600
	Equipment				67600
	Allowance for uncollectible accounts		1900.00
	Jesse's capital				108300.00
	(for capital contributed)
b.	Cash				21500
	Merchandise inventory			48000
	Tim's Capital				69500
	(for capital contributed)