Question

On April 1, 2011, Whitney Lang and El Capriforma partnership. Lang agrees to invest $17,100 cash and merchandise inventory valued at $46,200. Capri invests certain business assets at valuations agreed upon, transfers business liabilities, and contributes sufficient cash to bring his total capital to $115,000 Details regarding the book values of the business assets and liabilities, and the agreed valuations, follow: Accounts Receivable Allowance for Doubtful Accounts Merchandise Inventory Equipment Accumulated Depreciation-Equipment Accounts Payable Notes Payable (current) Capri's Ledger Agreed-Upon Balance Balance 526,200 $21,200 1,100 1,400 30,400 40,700 51,300 49,000 17.100 9,200 9.200 5,600 5.600 The partnership agreement includes the following provisions regarding the division of net income interest of 10% on original investments, salary allowances of 551,300 (lang) and 531,300 (Caprt), and the remainder equally Required: 1. Journale the entries to record the investments of Lang and Cars in the partnership accounts. If an amount box does not require an entry leave blank ACCOUNT DEBIT CREDIT

Answer 1

Answer 1) Journal Entries

Date	Particulars	Debit	Credit
April, 1	Cash	17,100
	Merchandise Inventory	46,200
	Lang's Capital		63,300
April, 1	Account Receviable	21,200
	Merchandise Inventory	40,700
	Equipement	49,800
	Cash	19,500
	Allowance for Doubtful Accounts		1,400
	Accounts Payable		9,200
	Notes Payable		5,600
	Capri's Capital		1,15,000

Answer 2) Balance Sheet Of Lang & Capri as on 1st April, 2011

Lang & Capri
Balance Sheet
Assets
Current Assets
Cash		36,600
Account Receviable	21,200
Allowance for Doubtful Accounts	(1,400)	19,800
Merchandise Inventory		86,900
Total Currrent Assets			1,43,300
Property, Plant & Equipment
Equipment			49,800
Total Assets			1,93,100
Liabilities
Current Liabilities
Account Payable		9,200
Notes Payable		5,600
Total Liabilities			14,800
Capital
Lang's Capital		63,300
Capri's Capital		1,15000
Total Capital			1,78,300

Answer 3) Journal Entries

Date	Particulars	Debit	Credit
March 31	Revenue	4,93,000
	Expenses		3,23,000
	Lang's Capital		85,000
	Capri's Capital		85,000
March 31	Lang's Capital	59,000
	Capri's Capital	51,000
	Lang,s Drawings		59,000
	Capri's Drawings		51,000