Two sole proprietors, L and M, agreed to form a partnership on January 1, 20x4. The trial balance for each proprietor is shown below as of January 1, 20x4. L M Book Value Fair Value Book Value Fair Value Cash.. P 40,000 P 40,000 P 30,000 P 30,000 Accounts receivable (net). 60,000 52,000 70,000 56,000 Merchandise inventory 100,000 94,000 100,000 114,000 Building (net)..... 280,000 320,000 250,000 280,000 Furniture and Fixture (net).. 60,000 64,000 40,000 44,000 Accounts Payable... 110,000 110,000 80,000 80,000 Mortgage Payable. 200,000 200,000 150,000 150,000 L, Capital. 230,000 M, Capital 260,000 The LM partnership will take over the assets and assume the liabilities of the proprietor as of January 1, 20x4.
Two sole proprietors, L and M, agreed to form a partnership on January 1, 20x4. The trial balance for each proprietor is shown below as of January 1, 20x4. L M Book Value Fair Value Book Value Fair Value Cash.. P 40,000 P 40,000 P 30,000 P 30,000 Accounts receivable (net). 60,000 52,000 70,000 56,000 Merchandise inventory 100,000 94,000 100,000 114,000 Building (net)..... 280,000 320,000 250,000 280,000 Furniture and Fixture (net).. 60,000 64,000 40,000 44,000 Accounts Payable... 110,000 110,000 80,000 80,000 Mortgage Payable. 200,000 200,000 150,000 150,000 L, Capital. 230,000 M, Capital 260,000 The LM partnership will take over the assets and assume the liabilities of the proprietor as of January 1, 20x4.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Two sole proprietors, L and M, agreed to form a
SEE ATTACHED FILE
The LM partnership will take over the assets and assume the liabilities of the proprietor as of January 1, 20x4.
Determine the total assets after the formation of the partnership.
Transcribed Image Text:Two sole proprietors, L and M, agreed to form a partnership on January
1, 20x4. The trial balance for each proprietor is shown below as of
January 1, 20x4.
L
M
Book Value Fair Value
Book Value Fair Value
Cash..
P 40,000 P 40,000
P 30,000
P 30,000
Accounts receivable (net).
60,000
52,000
70,000
56,000
Merchandise inventory
100,000
94,000
100,000
114,000
Building (net).....
280,000
320,000
250,000
280,000
Furniture and Fixture (net).. 60,000
64,000
40,000
44,000
Accounts Payable...
110,000
110,000
80,000
80,000
Mortgage Payable.
200,000
200,000
150,000
150,000
L, Capital.
230,000
M, Capital
260,000
The LM partnership will take over the assets and assume the liabilities
of the proprietor as of January 1, 20x4.
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