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Omar Mndez and Rafael Cuadrado decide to form a partnership that began operations on January...

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Accounting

Omar Mndez and Rafael Cuadrado decide to form a partnership that began operations on January 2, 2025. Mndez invests $ 8,800 in cash and Account Receivable for a value of $ 22,000 less Allowance for Doubtfull Accounts of $ 2,200. Cuadrado contributes $ 16,500 in cash and equipment with a book value of $ 6,600 and a fair market value of $ 11,000. Both agreed to contribute 50% of the capital of the company.
The Partnership Agreement specifies that Mndez will have a salary of $ 20,000 and Square of $ 25,000. Each partner will also have an interest income equal to 10% of their initial capital balance and the remaining income will be divided equally. As of December 31, 2025, there were the following balances on the General Ledger:
Service Revenue $ 135,200 Total Expenses 43,200. O Mendez-drawings 5,500 R Square-drawings 3,300 O Mndez-additional investment 15,000 R Square-additional investment 6,000 Total Liabilities 25,000
Prepare Jornal entries to recognize the initial investment of the partners. Income Statement Owners Equity Statement Liabilities and Owner's Equity Portion of Balance Sheet Closing entries as of December 31, 2025

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