Tommy and Gilbert agree to combine their businesses and form a partnership on 3 January...
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Accounting
Tommy and Gilbert agree to combine their businesses and form a partnership on 3 January 2015. They agree that their opening capital balances in the new partnership should be the same and set the amount at $100 000, and they also agree to use direct method to maintain its bad debts. The fair value and the carrying amount of the assets contributed by each partner and the liabilities assumed by the partnership are shown below:
| Tommy | Gil | |
| carry amount fair value | carry amount fair value | |
| cash at bank | 6,200 6,200 | 5,800 5,800 |
| accounts receivable | 13,000 12,800 | 15,000 11,400 |
| Inventory | 22,000 21,500 | 18,500 18,300 |
| Equipment | 72,000 48,000 | 75,000 32,000 |
| Accumdepreciation | (18,600) - | (26,500) - |
| Accounts payable | 13,400 13,400 | 12,800 12,800 |
Required
Prepare entries in general journal form to record the formation of the partnership (ignore GST)
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