Sir Win – Accounting Lectures

Jokes Tagalog
Stories Legit Professor
Life Lessons

----------------------------------------------------------------------------------------
----------------------
Lecture 05: Partnership Dissolution – Incorporation
----------------------------------------------------------------------------------------
----------------------

The statement of financial position of the partnership of

Montealto and Odiver as of Dec. 31, 2019 showed the
following:

Book Value Fair Value

Cash 200,000 200,000
Accounts Receivable 150,000 135,000
Allow. for bad debts (20,000)
Inventory 100,000 120,000
Equipment 250,000 180,000
Accum. Depr (50,000)
Accounts Payable 230,000 230,000
Montealto, Capital 200,000
Odiver, Capital 200,000

On this date, the partnership was dissolved and its net assets
transferred to a newly-formed corporation. Each of the partners
was issued 10,000 shares of the corporation’s P20 par ordinary
share.

Required:

Prepare the journal entries in the books of the corporation.