On January 1, 2016, Chris Hunts and Carol Lo formed the Chris and Carol Partnership by investing the following assets
An independent appraiser believes that Chris's equipment has a market value of $29,000 and Carol's equipment has a market value of $47,500. The appraiser indicates Chris's building has a current value of $90,000 and Carol's building has a current value of $110,000. The appraiser further indicates that Chris's land has a current value of $78,000 and Carol's land has a current value of $80,000. Chris and Carol agree to share profits and losses in a 60:40 ratio. During the first year of operations, the business net income is $74,000. Each partner withdrew $30,000 cash.
1. Prepare the journal entries to record the initial investments in the business by Chris and Carol.
2. Prepare a balance sheet dated January 1, 2016, after the completion of the initial journal entries.
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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