1. Business
  2. Accounting
  3. on june 1 2017 jill bow and aisha amri formed...

Question: on june 1 2017 jill bow and aisha amri formed...

Question details

On June 1, 2017, Jill Bow and Aisha Amri formed a partnership, to open a commercial gluten-free bakery, contributing $286,000 cash and $372,000 of equipment, respectively. Also, the partnership assumed responsibility for a $46,000 note payable associated with the equipment. The partners agreed to share profits as follows: Bow is to receive an annual salary allowance of $156,000, both are to receive an annual interest allowance of 5% of their original capital investments, and any remaining profit or loss is to be shared 40/60 (to Bow and Amri, respectively). On November 20, 2017, Amri withdrew cash of $106,000. At year-end, May 31, 2018, the Income Summary account had a credit balance of $440,000. On June 1, 2018, Peter Wilems invested $126,000 and was admitted to the partnership for a 20% interest in equity Required: 1. Prepare journal entries for the following dates. a. June 1, 2017 View transaction list Journal entry worksheet Record the formation of partnership. Note: Enter debits before credits. Date General Journal Debit Credit June 01, 2017 Record entry Clear entry View general journalb. November 20, 2017 View transaction list Journal entry worksheet Record the withdrawal by partner. Note: Enter debits before credits. Date General Journal Debit Credit Nov 20, 2017 Record entry Clear entry View general journalc. May 31, 2018 View transaction list Journal entry worksheet Record the closing of profit to capital. Note: Enter debits before credits. Date General Journal Debit Credit May 31, 2018 Record entry Clear entry View general journald. June 1, 2018 View transaction list Journal entry worksheet Record the admission of Wilems for a 20% interest. Note: Enter debits before credits. Date General Journal Debit Credit June 01, 2018 Record entry Clear entry View general journal 2. Calculate the balance in each partners capital account immediately after the June 1, 2018, entry. Bow, capital Aisha Amri, capital Wilems, capital

Solution by an expert tutor
Blurred Solution
This question has been solved
Subscribe to see this solution