PARTNERSHIP OPENING ENTRIES On July 1, 20--, Susan Woodworth and Barbara Holly combined their two businesses to form a partnership under the firm name of Woodworth and Holly. The balance sheets of the two sole proprietorships are shown below and on the next page.The balance sheets reflect fair market values except for the following:(a) The fair market value of Woodworth’s store equipment is $7,500.(b) The fair market values of Holly’s office equipment and store equipment are $6,100 and $6,800, respectively.RequiredPrepare the opening entry for the formation of the Woodworth and Holly partnership as of July 1, 20--, using fair market values. The difference between assets invested and liabilities assumed should be credited to each partner’s capital account. Neither partner has knowledge of any uncollectible accounts receivable. Woo dworth's AntiquesBalance SheetJune 30, 20-AssetsLlabiltiesCash$ 7,100Motes payable$2,500$4,500Accounts payableAccounts recetvable8400Less allowanceforbaddebts6203,880Total lablitles$10,900Merchandse nventory21 430Store equpmant$8.200Owner's EquityLess acaumulateddeprecak ken1,3006,900Susan Woodworth, capital28,410Total asets$39,310Total labikles and owTer's equity$39,310Holy's Uninshed FưrntureBalance SheetJune 30, 20--AssetsLabilitlesCash$ 4,520Motes payable$8,000Accounts recelvatle$3,75Accounts payatie6,300Less alowance for bad debts4752,800Total labilbes$14,300Nerchandbe inventory28,190Supplesofke equipnentLess accumalated depreciation960$7 A001,8005,600Stor equipmentLess accumilated depreciation$7,700Owner's Equity1,5006,200Bartara Holly, captal33,970Totalassets$48,70Total labiiies and owner's equity$48,270

Partnership is an agreement between two or more than two partners in which they invest capital, run…

Woo dworth's Antiques Balance Sheet June 30, 20- Assets Llabilties Cash $ 7,100 Motes payable $2,500 $4,500 Accounts payable Accounts recetvable 8400 Less allowanceforbaddebts 620 3,880 Total lablitles $10,900 Merchandse nventory 21 430 Store equpmant $8.200 Owner's Equity Less acaumulateddeprecak ken 1,300 6,900 Susan Woodworth, capital 28,410 Total asets $39,310 Total labikles and owTer's equity $39,310 Holy's Uninshed Fưrnture Balance Sheet June 30, 20-- Assets Labilitles Cash $ 4,520 Motes payable $8,000 Accounts recelvatle $3,75 Accounts payatie 6,300 Less alowance for bad debts 475 2,800 Total labilbes $14,300 Nerchandbe inventory 28,190 Supples ofke equipnent Less accumalated depreciation 960 $7 A00 1,800 5,600 Stor equipment Less accumilated depreciation $7,700 Owner's Equity 1,500 6,200 Bartara Holly, captal 33,970 Totalassets $48,70 Total labiiies and owner's equity $48,270

Woo dworth's Antiques Balance Sheet June 30, 20- Assets Llabilties Cash $ 7,100 Motes payable $2,500 $4,500 Accounts payable Accounts recetvable 8400 Less allowanceforbaddebts 620 3,880 Total lablitles $10,900 Merchandse nventory 21 430 Store equpmant $8.200 Owner's Equity Less acaumulateddeprecak ken 1,300 6,900 Susan Woodworth, capital 28,410 Total asets $39,310 Total labikles and owTer's equity $39,310 Holy's Uninshed Fưrnture Balance Sheet June 30, 20-- Assets Labilitles Cash $ 4,520 Motes payable $8,000 Accounts recelvatle $3,75 Accounts payatie 6,300 Less alowance for bad debts 475 2,800 Total labilbes $14,300 Nerchandbe inventory 28,190 Supples ofke equipnent Less accumalated depreciation 960 $7 A00 1,800 5,600 Stor equipment Less accumilated depreciation $7,700 Owner's Equity 1,500 6,200 Bartara Holly, captal 33,970 Totalassets $48,70 Total labiiies and owner's equity $48,270

Survey of Accounting (Accounting I)

8th Edition

ISBN:9781305961883

Author:Carl Warren

Publisher:Carl Warren

Chapter9: Metric-analysis Of Financial Statements

Section: Chapter Questions

Problem 9.23E: Unusual income statement items Assume that the amount of each of the following items is material to...

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