Jesse and Tim Form a Partnership by Combining the Assets

question 87

Essay

Jesse and Tim form a partnership by combining the assets of their separate businesses. Jesse contributes accounts receivable with a face amount of $50,000 and equipment with a cost of $180,000 and accumulated depreciation of $100,000. The partners agree that the equipment is to be valued at $58,000, that $3,500 of the accounts receivable are completely worthless and are not to be accepted by the partnership, and that $2,000 is a reasonable allowance for the uncollectibility of the remaining accounts receivable. Tim contributes cash of $21,000 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.

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Definitions:

Investigative

Describes a personality or approach focused on exploring, researching, and understanding problems or questions.

Enterprising

Describes initiative-taking, resourceful, and risk-taking behavior, often associated with starting new ventures or pursuing business goals.

Ambitious

Having a strong desire to succeed or achieve something, often requiring determination and hard work.

Sociable

Refers to an individual's inclination to seek and enjoy social interactions.