Accounting Principles: P12-1A The post-closing trial balances of two proprietorships

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Accounting Principles
P12-1A
The post-closing trial balances of two proprietorships on January 1, 2010, are presented below. Patrick Company Samuelson Company
Dr Cr Dr Cr
Cash 14,000 12,000
Accounts Receivable 17,500 26,000
Allowance for doubtful accounts 3,000 4,400
Merchandise Inventory 26,500 18,400
Equipment 45,000 29,000
Accumulated Depreciation Eq 24,000 11,000
Notes Payable 18,000 15,000
Accounts payable 22,000 31,000
Patrick, Capital 36,000
Samuelson, Capital 24,000
103,000 103,000 85,400 85,400

Patrick and Samuelson decide to form a partnership, Pasa Company, with the following agreed upon valuations for noncash assets.
Patrick Company Samuelson Company
Accounts Receivable 17,500 26,000
Allowance for doubtful accounts 4,500 4,000
Merchandise Inventory 28,000 20,000
Equipment 23,000 16,000

All cash will be transferred to the partnership, and the partnership will assume all the liabilities of the two proprietorships. Further, it is agreed that Patrick will invest an additional $5,000 in cash, and Samuelson will invest an additional $19,000 in cash.

Instructions:
(a) Prepare separate journal entries to record the transfer of each proprietorship's assets and liabilities to the partnership.
(b) Journalize the additional cash investment by each partner.
(c) Prepare a classified balance sheet for the partnership on January 1, 2010.
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