Wiggins L Stokes and K

question 143

Essay

Wiggins L. Stokes and K. Hayes are forming a partnership. Wiggins is transferring $75000 of personal cash to the partnership. Stokes owns land worth $25000 and a small building worth $120000 which she transfers to the partnership. Hayes transfers to the partnership cash of $14000 accounts receivable of $48000 and equipment worth $28000. The partnership expects to collect $45000 of the accounts receivable.
Instructions
(a) Prepare the journal entries to record each of the partners' investments.
(b) What amount would be reported as total owners' equity immediately after the investments?

---

Definitions:

Opportunity Cost

Turning down potential benefits from several alternatives by locking in on one.

College Degree

An academic degree conferred by colleges or universities upon students who have completed a course of study or major.

Lifetime Earnings

The total amount of money a person is expected to earn over the course of their career.

Marginal Cost

The charge incurred from the production of an extra unit of a product or service.