Todd Jost and D. Caldwell decide to form a partnership by combining the assets of their separate businesses. Jost contributes the following assets to the partnership: cash, $6,000; accounts receivable with a face amount of $96,000 and an allowance for doubtful accounts of $6,600; merchandise inventory with a cost of $85,000; and equipment with a cost of $140,000 and accumulated depreciation of $90,000.
The partners agree that $5,000 of the accounts receivable are completely worthless and are not to be accepted by the partnership, that $8,000 is a reasonable allowance for the uncollectibility of the remaining accounts, that the merchandise inventory is to be recorded at the current market price of $76,500, and that the equipment is to be valued at $90,000.
Journalize the partnership?s entry to record Jost?s investment.
This question was answered on: Jul 11, 2017
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