Question

CE Dr. Cr. Cash Dr. $11,000 14,000 $9,600 21,000 $2,400 $3,500 21,000 36,000 14,700 23,000 Accounts receivable Allowance for doubtful accounts Inventory Equipment Accumulated depreciation-equipment Notes payable Accounts payable Sorensen, capital Lucas, capital 19,200 14,400 17,600 28,400 8,800 12,000 24,800 $82,000 $82,000 19,200 $68,300 $68,300 Sorensen and Lucas decide to form a partnership, Ivanhoe Company, with the following agreed upon valuations for noncash assets. Accounts receivable Allowance for doubtful accounts Inventory Equipment Sorensen Company $14,000 3,600 22,400 20,000 Lucas Company $21,000 3,200 16,000 12,000 All cash will be transferred to the partnership, and the partnership will assume all the liabilities of the two proprietorships. Prepare separate lournal antin

Answer 1

Credit Debit 11,000 14,000 22,400 20,000 Date Account title & explanation 1-Jan Cash Accounts Receivable Inventory Equipment Allowance For Doubtful Debts Notes Payable Accounts Payable Sorensen, Capital (Transfer of Sorensen's assets and liabilities) 3,600 14,400 17,600 31,800 9,600 21,000 16,000 12,000 1-Jan Cash Accounts Receivable Inventory Equipment Allowance For Doubtful Debts Notes Payable Accounts Payable Lucas, Capital (Transfer of Lucas's assets and liabilities) 3,200 12,000 24,800 18,600 4,000 1-Jan Cash Sorensen, Capital (To record Sorensen's investment) 4,000

15,200 1-Jan Cash Lucas, Capital (To record Sorensen's investment) 15,200 39,800 IVANHOE COMPANY Balance Sheet As on January 1,2020 Assets Current Assets Cash Accounts Receivable less Allowance For Doubtful Debts Inventory Total Current assets Property,Plant and Equipment Equipment Total Assets 35,000 (6,800) 28,200 38,400 106,400 32,000 138,400

42,400 26,400 68,800 Liabilities and Owner's Equity Current Liabilities Accounts Payable Notes Payable Total Current Liabilities Owner's Equity Sorensen, Capital Lucas, Capital Total Owner's Equity Total Liabilities and Owner's Equity 35,800 33,800 69,600 138,400