Hannah Freeman and Hugo Hernandez form a partnership by combining assets of theirformer businesses. The following balance sheet information is provided by Freeman,sole proprietorship:Hannah Freeman ProprietorshipBalance SheetJune 1, 20Y3$ 65,000CashAccounts receivable$125,000Less: Allowance for doubtful accounts7,200117,800Land215,000$ 78,000EquipmentLess: Accumulated depreciation-equipment41,00037,000Total assets$434,800$ 24,800Accounts payableNotes payableHannah Freeman, capital76,000334,000Total liabilities and owner's equity$434,800Freeman obtained appraised values for the land and equipment as follows:Land$320,000Equipment34,800An analysis of the accounts receivable indicated that the allowance for doubtful accountsshould be increased to $9,500.Journalize the partnership's entry for Freeman's investment.

Partnership: It is a form of an organization which is owned and managed by two or more persons who…

Answered: Hannah Freeman and Hugo Hernandez form…

SWFT Corp Partner Estates Trusts

42nd Edition

ISBN:9780357161548

Author:Raabe

Publisher:Raabe

Chapter13: Comparative Forms Of Doing Business

Section: Chapter Questions

Problem 29CE

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Mary, Jane and Susan are in partnership sharing profits and losses in the ratio 2:2:1 respectively.The following was their balance sheet as at 31 December 2018: Cost Depreciation. NBVNon-Current Assets $ $ $Premises 42,000 32,000 10,000Motor Vehicles 14,000 10,000 4,000Furniture and Fittings 6,000 2,000 4,000 62,000 44,000 18,000Current Assets Inventory 24,000Trade Receivables 6,800 30,800 48,800Capital and LiabilitiesCapitals: Mary 7,000 Jane…
Hannah Freeman and Hugo Hernandez form a partnership by combining assets of their former businesses. The following balance sheet information is provided by Freeman, sole proprietorship: Hannah Freeman Proprietorship Balance Sheet June 1, 20Y3 Cash $32,350 Accounts receivable $60,800 Less: Allowance for doubtful accounts 3,600 57,200 Land 146,000 Equipment $57,000 Less: Accumulated depreciation—equipment 34,900 22,100 Total assets $257,650 Accounts payable $18,100 Notes payable 53,250 Hannah Freeman, capital 186,300 Total liabilities and owner's equity $257,650 Freeman obtained appraised values for the land and equipment as follows: Land $203,000 Equipment 17,200 An analysis of the accounts receivable indicated that the allowance for doubtful accounts should be increased to $5,300. Journalize the partnership's entry for Freeman’s investment. If an amount box does not require an entry, leave it blank.
Items 34 and 35 are based on the following information: On January 2,2010, Jason and Melissa formed a partnership by contributing the following assets: Cash Accounts Receivable Merchandise Inventory Land Building Jason P ? 80,000 100,000 Melissa 34. On January 2, 2010, Melissa, Capital amounts to a. P440,000 b. P600,000 P 380,000 240,000 The Land invested by Melissa is subject to mortgage loan of P160,000, which is to be assumed by the partnership. The accounts receivable invested by Jayson are believed to be only 90% collectible. d. P1,040,000 35. Assuming that Jayson is to contribute enough cash to bring his capital equal to that of Melissa, required cash contribution of Jayson is a. P268,000 b. P420,000 d. P600,000 c. P760,000 c. P440,000
A is the owner of an existing single proprietorship with net assets of 50,000. they agreed torecord the assets and liabilities of A’s business at book value. The book value of A’s businessliability is 60,000. B and C will contribute equally in cash 60% of the total capitalization based onthe capital contribution of A. the capital contribution of B should be A. 37,500B. 75,000C. 82,500D. 165,000
Jane and Kathy are joining their separate business to form a partnership. Cash and non-cash assets are to be contributed for a total capital of P300,000. The non-cash assets are to be contributed and liabilities to be assumed are as follows: Jane Kathy Book Value Fair Value Book Value Fair Value Receivable Inventories Equipment Payable P 22,500 22,500 37,500 11,250 P 22,500 33,750 30,000 11,250 P 60,000 67,500 7,500 P67,500 71,250 7,500 The partner's capital accounts are to be equal after all contributions of assets and assumptions of liabilities. Determine the total assets of the partnership.
Rodrigo and Harry are both owners of an existing single proprietorship businesses. They agreed to combine their businesses into a partnership. They agreed to start a total capitalization of P400,000 to be contributed equally. Balances per individual Statement of Financial Position Cash Assets Noncash assets Liabilities Equity ● Rodrigo ● 20,000 85,000 105,000 Harry 5,000 135,000 10,000 They also agreed to the following valuation of their businesses' non-cash assets. Noncash assets should be valued at 80%. Liabilities will not be absorbed by the partnership. How much additional cash should be contributed by Rodrigo & Harry respectively? 130,000
The Spirit Partnership owns the following assets on October 1 of the current year: Assets Partnership’s Basis FMV Cash $30,000 $30,000 Receivables 0 16,000 Inventory 50,000 52,000 Supplies 6,000 6,500 Equipment* 9,000 10,500 Land 40,000 65,000 Total $135,000 $180,000 *Partnership has claimed $4,000 depreciation on the equipment a. Which items are considered as unrealized receivables of the partnership? b. Is the partnership’s inventory substantially appreciated? c. Assume the Spirit Partnership has no liabilities and that partner Betsy’s basis for her partnership interest is $33,750. On March 1 of the current year, Betsy receives a $20,000 current distribution in cash, which reduces her partnership interest from one-third to one-fourth. What are the tax results of the distribution (i.e., the amount and character of any gain, loss, or income recognized and Betsy’s basis in her partnership interest)? No handwritten solution please
P1 is a one-third owner in ABC LLC. P1 sold his interest in ABC to B1 for $95,000 in cash (plus assumption of liabilities of ABC). Assume P1's inside and outside basis in ABC are equal. ABC's balance sheet at the dale of sale follows. Determine the amount and character of the gain or loss P1 will realize at the sale. ASSETS: Cash Receivables Inventory Land LIABILITIES AND CAPITAL: Liabilities Capital-P1 Capital-P2 Capital-P3 Tax Basis 60,000 60,000 120,000 120,000 70,000 130,000 50,000 55,000 300,000 365,000 30,000 90,000 90,000 90,000 FMV 300,000
Required information Kevan, Jerry, and Dave formed Albee LLC. Jerry and Dave each contributed $245,000 in cash. Kevan contributed the following assets: Kevan: Cash Land* Totals Basis Fair Market Value $ 15,000 120,000 $ 15,000 440,000 $ 135,000 $ 455,000 *Nonrecourse liability secured by the land equals $210,000. Each member received a one-third capital and profits interest in the LLC. Note: Leave no answer blank. Enter zero if applicable. Round to the nearest whole thousand. f. If the lender holding the nonrecourse liability secured by Kevan's land required Kevan to guarantee 1/3 of the liability and Jerry to guarantee the remaining 2/3 of the liability when Albee LLC was formed, how much gain or loss will Kevan recognize? X Answer is complete but not entirely correct. Gain or loss recognized $ 0X
Hillary Bruce and Cindy own a partnership firm. Hillary has an ownership interest of $24,000, Bruce has an ownership interest of $41,000, and Cindy has an ownership interest of $30,000. In the process of liquidation, the partnership sells non cash assets and registers a gain of $30,000. The profit loss sharing agreement is 1:2:3 respectively. Which of the following is TRUE when a journal entry for the allocation of gain is recorded? A) Hillary Capital is credited for $10,000. B) Cindy, Capital Is credited for $15,000 C) Hillary capital is debited for $10,000. D) Cindy Capital is credited for $ 10,000
Non-Cash Assets recorded in the accounting records as $30 sold for $50 during the liquidation process. Consider the following: Easy, Capital Balance $12 Peasy, Capital Balance $13 Gains and Losses are divided equally. How would the partners' capital balances be affected by the sale of the non-cash assets? Group of answer choices a. Peasy's balance would increase by $10 . b. Peasy's balance would decrease by $10 . c. Peasy's balance would increase by $13. d. Peasy's balance would decrease by $13.
Sofia contributed the following business assets to S&S Partnership on March 3, 2022: FMV $ 45,000 $-0- $ 100,000 What is the basis in the equipment and the accounts receivable to S&S? Equipment Accounts receivable Multiple Choice Basis $ 75,000 Equipment $45,000; Accounts Receivable $100,000 Equipment $0; Accounts Receivable $0 Equipment $45,000; Accounts Receivable $0 Equipment $75,000; Accounts Receivable $0 Date purchased by Sofia 07/01/21 Various

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