Question

Tom and Julie formed a management consulting partnership on January 1, 2008. The fair value of the net assets invested by each partner follows:


During the year, Tom withdrew $15,000 and Julie withdrew $12,000 in anticipation of operating profits. Net profit for 2008 was $50,000, which is to be allocated based on the original net capital investment.

Required:
A. Prepare journal entries to:
(1) Record the initial investment in the partnership.
(2) Record the withdrawals.
(3) Close the Income Summary and Drawing accounts.
B. Prepare a statement of changes in partners’ capital for the year ended December31,


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  • CreatedMarch 16, 2015
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