Challoner Matero offered to invest cash to get a capital credit equal to one-half of the Leopoldo Medina’s capital after

giving effect to the adjustment below. Medina accepted the offer.

1. Merchandise inventory is to be valued at 74,000

2. The account receivable is 95% collectible.
3. Interest accrued on the note receivable will be recognized 10,000, 12% dated July 1 2019 and 20,000, 12% dated
August 1, 2019.
4. Interest on notes payable to be accrued at 14% annually from April 1, 2019.
5. The furniture and fixtures are to be valued at 46,000.
6. Office supplies on hand that have been charged to expense in the past amounted to 4,000. These will be used by
the partnership.

Required: Prepare the journal entries to record the formation of the partnership.

Gains, losses, income and expenses adjustments will be reflected directly to CAPITAL ACCOUNT.

1. Medina Capital 6,000

Inventory (80,000-74,000) 6,000

Challoner Matero offered to invest cash to get a capital credit equal to one-half of the Leopoldo Medina’s capital after
giving effect to the adjustment below. Medina accepted the offer.

7. Merchandise inventory is to be valued at 74,000

8. The account receivable is 95% collectible.
9. Interest accrued on the note receivable will be recognized 10,000, 12% dated July 1 2019 and 20,000, 12% dated
August 1, 2019.
10. Interest on notes payable to be accrued at 14% annually from April 1, 2019.
11. The furniture and fixtures are to be valued at 46,000.
12. Office supplies on hand that have been charged to expense in the past amounted to 4,000. These will be used by
the partnership.

Required: Prepare the journal entries to record the formation of the partnership.

Gains, losses, income and expenses adjustments will be reflected directly to CAPITAL ACCOUNT.

2. Medina Capital 6,000

Inventory (80,000-74,000) 6,000

Challoner Matero offered to invest cash to get a capital credit equal to one-half of the Leopoldo Medina’s capital after
giving effect to the adjustment below. Medina accepted the offer.

13. Merchandise inventory is to be valued at 74,000

14. The account receivable is 95% collectible.
15. Interest accrued on the note receivable will be recognized 10,000, 12% dated July 1 2019 and 20,000, 12% dated
August 1, 2019.
16. Interest on notes payable to be accrued at 14% annually from April 1, 2019.
17. The furniture and fixtures are to be valued at 46,000.
18. Office supplies on hand that have been charged to expense in the past amounted to 4,000. These will be used by
the partnership.

Required: Prepare the journal entries to record the formation of the partnership.

Gains, losses, income and expenses adjustments will be reflected directly to CAPITAL ACCOUNT.

3. Medina Capital 6,000

Inventory (80,000-74,000) 6,000

Challoner Matero offered to invest cash to get a capital credit equal to one-half of the Leopoldo Medina’s capital after
giving effect to the adjustment below. Medina accepted the offer.

19. Merchandise inventory is to be valued at 74,000

20. The account receivable is 95% collectible.
 21. Interest accrued on the note receivable will be recognized 10,000, 12% dated July 1 2019 and 20,000, 12% dated
August 1, 2019.
22. Interest on notes payable to be accrued at 14% annually from April 1, 2019.
23. The furniture and fixtures are to be valued at 46,000.
24. Office supplies on hand that have been charged to expense in the past amounted to 4,000. These will be used by
the partnership.

Required: Prepare the journal entries to record the formation of the partnership.

Gains, losses, income and expenses adjustments will be reflected directly to CAPITAL ACCOUNT.

4. Medina Capital 6,000

Inventory (80,000-74,000) 6,000

Challoner Matero offered to invest cash to get a capital credit equal to one-half of the Leopoldo Medina’s capital after
giving effect to the adjustment below. Medina accepted the offer.

25. Merchandise inventory is to be valued at 74,000

26. The account receivable is 95% collectible.
27. Interest accrued on the note receivable will be recognized 10,000, 12% dated July 1 2019 and 20,000, 12% dated
August 1, 2019.
28. Interest on notes payable to be accrued at 14% annually from April 1, 2019.
29. The furniture and fixtures are to be valued at 46,000.
30. Office supplies on hand that have been charged to expense in the past amounted to 4,000. These will be used by
the partnership.

Required: Prepare the journal entries to record the formation of the partnership.

Gains, losses, income and expenses adjustments will be reflected directly to CAPITAL ACCOUNT.

5. Medina Capital 6,000

Inventory (80,000-74,000) 6,000

Challoner Matero offered to invest cash to get a capital credit equal to one-half of the Leopoldo Medina’s capital after
giving effect to the adjustment below. Medina accepted the offer.

31. Merchandise inventory is to be valued at 74,000

32. The account receivable is 95% collectible.
33. Interest accrued on the note receivable will be recognized 10,000, 12% dated July 1 2019 and 20,000, 12% dated
August 1, 2019.
34. Interest on notes payable to be accrued at 14% annually from April 1, 2019.
35. The furniture and fixtures are to be valued at 46,000.
36. Office supplies on hand that have been charged to expense in the past amounted to 4,000. These will be used by
the partnership.

Required: Prepare the journal entries to record the formation of the partnership.

Gains, losses, income and expenses adjustments will be reflected directly to CAPITAL ACCOUNT.

6. Medina Capital 6,000

Inventory (80,000-74,000) 6,000