On march 1 2008 eckert and kelley formed a partnership

Assignment Help Accounting Basics

Reference no: EM13600198

On March 1, 2008, Eckert and Kelley formed a partnership. Eckert contributed $82,500 cash and Kelley contributed land valued at $60,000 and a building valued at $100,000.The partnership also assumed responsibility for Kelley's $92,500 long-term note payable associated with the land and building. The partners agreed to share income as follows: Eckert is to receive an annual salary allowance of $25,000, both are to receive an annual interest allowance of 10% of their beginning-year capital investment, and any remaining income or loss is to be shared equally. On October 20, 2008, Eckert withdrew $34,000 cash and Kelley withdrew $20,000 cash. After the adjusting and closing entries are made to the revenue and expense accounts at December 31, 2008, the Income Summary account had a credit balance of $90,000.

1. Prepare journal entries to record (a) the partners' initial capital investments, (b) their cash withdrawals, and (c) the December 31 closing of both the Withdrawals and Income Summary accounts.
2. Determine the balances of the partners' capital accounts as of December 31, 2008.

Reference no: EM13600198

Questions Cloud

During clean dirt incs first year of business salary : during clean dirt inc.s first year of business salary expense was 60000. at the end of its first year of business clean

Garr co issued 5000000 of 12 5 year convertible bonds on : garr co. issued 5000000 of 12 5 year convertible bonds on december 1 2010 for 5020800 plus accrued interest. the bonds

Clean dirt inc had 8000 of salaries payable at december 31 : clean dirt inc. had 8000 of salaries payable at december 31 2010. during 2011 clean dirts salary expense was 60000. at

Hme improvement company a retail home store has two major : home improvement company a retail home store has two major divisions-outdoors and indoors. here is the data on their

On march 1 2008 eckert and kelley formed a partnership : on march 1 2008 eckert and kelley formed a partnership. eckert contributed 82500 cash and kelley contributed land

Blue mountain power company obtained authorization to issue : blue mountain power company obtained authorization to issue 20 year bonds with a face value of 10 million. the bonds

Ue the following information to answer this question : use the following information to answer this question increase in inventories 28 purchased treasury stock 17

Prepare a common-size income statement and balance sheet : common-size statements analysis of profitability and financial position comparison with the industry and using ratios

Prepare journal entries for the following assume a : prepare journal entries for the following assume a calendar-year accounting perioddec. 1 received a three-month 15

User Account

All Pages