The Trial Balance of WM Partnership Is as Follows

question 36

Multiple Choice

The trial balance of WM Partnership is as follows:
Wilfred and Mike decide to incorporate their partnership.The partnership's books will be closed,and new books will be used for W & M Corporation.The following additional information is available:
1.The estimated fair values of the assets follow:
2.All assets and liabilities are transferred to the corporation.
3.The common stock is $10 par.Wilfred and Mike receive a total of 10,000 shares.
4.The partners share profits and losses in the ratio 7:3.
-Based on the preceding information,the journal entry on the partnership's books to record the Investment in W&M Corporation Stock will be debited for:

• A)$181,000
• B)$131,000
• C)$200,000
• D)$150,000

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Definitions:

Family Business

A commercial organization owned and managed by members of the same family.

Sharing Values

Sharing values denotes the practice of conveying and aligning beliefs and principles among members within an organization or community.

Common Goal

A shared objective or aim that unites members of a group or team, encouraging collaborative effort.

High Failure Rate

The condition where a significant percentage of attempts or endeavors (such as projects, products, or businesses) do not meet expected success criteria within a certain timeframe.