The post-closing trial balances of two proprietorships on January 1, 2017, are presented below. Sorensen and Lucas

Question:

The post-closing trial balances of two proprietorships on January 1, 2017, are presented below.

The post-closing trial balances of two proprietorships on January 1,

Sorensen and Lucas decide to form a partnership, Solu Company, with the following agreed upon valuations for noncash assets.

The post-closing trial balances of two proprietorships on January 1,

All cash will be transferred to the partnership, and the partnership will assume all the liabilities of the two proprietorships. Further, it is agreed that Sorensen will invest an additional $5,000 in cash, and Lucas will invest an additional $19,000 in cash.

Instructions
(a) Prepare separate journal entries to record the transfer of each proprietorship€™s assets and liabilities to the partnership.
(b)
Journalize the additional cash investment by each partner.
(c) Prepare a classified balance sheet for the partnership on January 1,2017.

Balance Sheet
Balance sheet is a statement of the financial position of a business that list all the assets, liabilities, and owner’s equity and shareholder’s equity at a particular point of time. A balance sheet is also called as a “statement of financial...
Partnership
A legal form of business operation between two or more individuals who share management and profits. A Written agreement between two or more individuals who join as partners to form and carry on a for-profit business. Among other things, it states...
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Accounting Principles

ISBN: 978-1118875056

12th edition

Authors: Jerry Weygandt, Paul Kimmel, Donald Kieso

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