Mike and Rachel decided to form the MR partnership. They agreed that Mike will be contributing P350,000 mcash, P25,000 of accounts receivable, and an equipment with a fair market value of P95,000 with a morigage, uhatis to be assumed by the partnership, of P10,000.Rachel, on the other hand, will contribute P180,000 cash, inventories worth P85,000, and a building with a fairmarket value of P280,000. She also has accounts payable, which will be assumed by the partnership, amountingto P20,000.They further agreed that their initial capital accounts must be equal. They also agreed that their total capitalcontributions would amount to P985,000.DescriptionDebitCreditDateP.R.EGO Solution for bonus computation (if there is any bonus):CCOUNTING

Step 1 Journal is the part of Book keeping.

Answered: Description P.R. Debit Credit

Business

Accounting

Description P.R. Debit Credit

SWFT Essntl Tax Individ/Bus Entities 2020

23rd Edition

ISBN:9780357391266

Author:Nellen

Publisher:Nellen

Chapter14: Partnerships And Limited Liability Entities

Section: Chapter Questions

Problem 2BD

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Question

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Mike and Rachel decided to form the MR partnership. They agreed that Mike will be contributing P350,000 m
cash, P25,000 of accounts receivable, and an equipment with a fair market value of P95,000 with a morigage, uhat
is to be assumed by the partnership, of P10,000.
Rachel, on the other hand, will contribute P180,000 cash, inventories worth P85,000, and a building with a fair
market value of P280,000. She also has accounts payable, which will be assumed by the partnership, amounting
to P20,000.
They further agreed that their initial capital accounts must be equal. They also agreed that their total capital
contributions would amount to P985,000.
Description
Debit
Credit
Date
P.R.
EGO

Solution for bonus computation (if there is any bonus):
CCOUNTING

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