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Formation of a Partnership Problem 1 Sabo, as her original investment in the firm of...

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Accounting

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Formation of a Partnership Problem 1 Sabo, as her original investment in the firm of Sabo and Ace, contributed equipment that had been recorded in the books of her own business as costing P900,000, with accumulated depreciation of P620,000. The partners agreed on a valuation of P400,000. They also agreed to accept Sabo's accounts receivable of P360,000, realizable to the extent of 85%. Required: Prepare the journal entry to record Sabo's investment in the partnership on June. Problem 2 Gord and Valir have just formed a partnership. Gord contributed cash of P 1,260,000 and computer equipment that cost P540,000. The fair value of the computer is P360,000. Gord has notes payable on the computer of P 120,000 to be assumed by the partnership. Gord is to have 60% capital interest in the partnership. Valir contributed only P900,000. The partners agreed to share profit and loss equally. Required: 1. How much investment(withdrawal) should Gord make? 2. Prepare the balance sheet of the new partnership

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