On December 31, 2012, Dana Davis and Lou Ghai agree to combine their proprietorships into a partnership. Their balance sheets on December 31 are shown as follows.

Requirements

1. Journalize the contributions of Davis and Ghai to the partnership.

2. Prepare the partnership balance sheet at December 31, 2012.

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Ghai's Business Davis's Business Current Market Value Current Market Value Book Value Book Value Assets s $ 9,000 $ 9,000 $ 6,000 $ 6,000 Cash . Accounts receivable. 26,000 16,000 14,000 24,000 49,000 123,000 $207.000 $181,000 $114,000 43,000 105.000 38,000 54,000 38,000 Inventory.. Plant assets (net). Total assets .. 58,000 $116.000 Liabilities and Owners' Equity $ 24,000 $ 24,000 $ 12,000 $ 12,000 Accounts payable. Accrued expenses payable. Notes payable . Davis, capital Ghai, capital. Total liabilities and owners' equity. 12,000 55,000 116,000 12,000 55,000 102.000 $114,000 $116,000 $181,000 $207,000