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Kristen Marks and Shelly Sudd decide to form a partnership on August 1. Marks in

ID: 2421363 • Letter: K

Question

Kristen Marks and Shelly Sudd decide to form a partnership on August 1. Marks invests the following assets and liabilities in the new partnership:

The note payable is associated with the building and the partnership will assume responsibility for the loan. Sudd invested $100,000 in cash and $95,000 in equipment in the new partnership. Prepare the journal entries to record the two partners' original investments in the new partnership

Market Value Land $80,000 Building 250,000 Note payable 114,000

Explanation / Answer

Journal Entries Particulars Dr Amt Cr Amt Land A/C Dr                   80,000.00 Building A/C Dr                 250,000.00 To Note Payable         114,000.00 To Marks Capital         216,000.00 Cash A/C Dr                 100,000.00 Equipment A/C dr                   95,000.00 To Sudd's Capital         195,000.00