Kimberly Payne and Arionna Maples decide to form a partnership by combining the assets of their separate businesses. Payne contributes the following assets to the partnership: cash, $24,560; accounts receivable with a face amount of $161,390 and an allowance for doubtful accounts of $4,490; merchandise inventory with a cost of $84,060; and equipment with a cost of $137,580 and accumulated depreciation of $45,680. The partners agree that $6,080 of the accounts receivable are completely worthless and are not to be accepted by the partnership, that $4,680 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 $99,950, and that the equipment is to be valued at $89,040. On December 1, journalize the partnership’s entry to record Payne’s investment. Refer to the Chart of Accounts for exact wording of account titles. CHART OF ACCOUNTSPayne and Arionna MaplesGeneral Ledger   ASSETS 110 Cash 111 Petty Cash 112 Accounts Receivable 113 Allowance for Doubtful Accounts 114 Interest Receivable 115 Notes Receivable 116 Merchandise Inventory 117 Office Supplies 118 Store Supplies 119 Prepaid Insurance 120 Land 123 Equipment 124 Accumulated Depreciation-Equipment 129 Asset Revaluations 133 Patent   LIABILITIES 210 Accounts Payable 211 Salaries Payable 213 Sales Tax Payable 214 Interest Payable 215 Notes Payable   EQUITY 310 Kimberly Payne, Capital 311 Kimberly Payne, Drawing 312 Arionna Maples, Capital 313 Arionna Maples, Drawing   REVENUE 410 Sales 610 Interest Revenue   EXPENSES 510 Cost of Merchandise Sold 520 Salaries Expense 521 Advertising Expense 522 Depreciation Expense-Equipment 523 Delivery Expense 524 Repairs Expense 529 Selling Expenses 531 Rent Expense 533 Insurance Expense 534 Office Supplies Expense 535 Store Supplies Expense 536 Credit Card Expense 537 Cash Short and Over 538 Bad Debt Expense 539 Miscellaneous Expense 710 Interest Expense On December 1, journalize the partnership’s entry to record Payne’s investment. Refer to the Chart of Accounts for exact wording of account titles. PAGE 1   JOURNAL ACCOUNTING EQUATION     DATE DESCRIPTION POST. REF. DEBIT CREDIT ASSETS LIABILITIES EQUITY 1                 2                 3                 4                 5                 6

Question
Kimberly Payne and Arionna Maples decide to form a partnership by combining the assets of their separate businesses. Payne contributes the following assets to the partnership: cash, $24,560; accounts receivable with a face amount of $161,390 and an allowance for doubtful accounts of $4,490; merchandise inventory with a cost of $84,060; and equipment with a cost of $137,580 and accumulated depreciation of $45,680.
The partners agree that $6,080 of the accounts receivable are completely worthless and are not to be accepted by the partnership, that $4,680 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 $99,950, and that the equipment is to be valued at $89,040.
On December 1, journalize the partnership’s entry to record Payne’s investment. Refer to the Chart of Accounts for exact wording of account titles.
CHART OF ACCOUNTSPayne and Arionna MaplesGeneral Ledger
  ASSETS
110 Cash
111 Petty Cash
112 Accounts Receivable
113 Allowance for Doubtful Accounts
114 Interest Receivable
115 Notes Receivable
116 Merchandise Inventory
117 Office Supplies
118 Store Supplies
119 Prepaid Insurance
120 Land
123 Equipment
124 Accumulated Depreciation-Equipment
129 Asset Revaluations
133 Patent
  LIABILITIES
210 Accounts Payable
211 Salaries Payable
213 Sales Tax Payable
214 Interest Payable
215 Notes Payable
  EQUITY
310 Kimberly Payne, Capital
311 Kimberly Payne, Drawing
312 Arionna Maples, Capital
313 Arionna Maples, Drawing
  REVENUE
410 Sales
610 Interest Revenue
  EXPENSES
510 Cost of Merchandise Sold
520 Salaries Expense
521 Advertising Expense
522 Depreciation Expense-Equipment
523 Delivery Expense
524 Repairs Expense
529 Selling Expenses
531 Rent Expense
533 Insurance Expense
534 Office Supplies Expense
535 Store Supplies Expense
536 Credit Card Expense
537 Cash Short and Over
538 Bad Debt Expense
539 Miscellaneous Expense
710 Interest Expense
On December 1, journalize the partnership’s entry to record Payne’s investment. Refer to the Chart of Accounts for exact wording of account titles.
PAGE 1
 
JOURNAL
ACCOUNTING EQUATION
 
  DATE DESCRIPTION POST. REF. DEBIT CREDIT ASSETS LIABILITIES EQUITY
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