Patsy Garrison Owns and Operates a Bakery Called Patsy's Pastries

question 82

Essay

Patsy Garrison owns and operates a bakery called Patsy's Pastries.Her postclosing trial balance on December 31,2016,is provided below.Garrison plans to enter into a partnership with Erika Noreen,effective January 1,2017.Profits and losses will be shared equally.Garrison will transfer all assets and liabilities of her store to the partnership,after revaluation.Noreen will invest cash equal to Garrison's investment after revaluation.The agreed values are: Accounts Receivable (net),$15,000;Merchandise Inventory,$54,000;and Store Equipment,$16,000.The partnership will operate under the name Baker's Delight.Record each partner's investment on page 1 of a general journal.Omit descriptions.
Prepare a balance sheet for Baker's Delight just after the investments.

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Definitions:

Positive Correlation

A relationship between two variables where they move in the same direction, meaning when one variable increases, the other also increases, and vice versa.

Slope

In mathematics, the measure of the steepness or incline of a line, often calculated as the ratio between the change in the y-value to the change in the x-value.

Horizontal Line

In geometry and graphing, a straight line that runs left to right (parallel to the x-axis) and has a slope of zero, indicating no change in the y-value across different points on the line.

Upward-sloping Line

A graphical representation often used to show a positive relationship between two variables on a graph, indicating that as one variable increases, the other does as well.