Question

Hannah Freeman and and Hugo Hernandez form a partnership by combining assets of their former businesses. The following balance sheet information is provided by Freeman, sole proprietorship:

Hannah Freeman Proprietorship
Balance Sheet
June 1, 20Y3
Cash			$42,350
Accounts receivable	$79,600
Less: Allowance for doubtful accounts	4,700		74,900
Land			191,000
Equipment	$74,000
Less: Accumulated depreciation-equipment	45,700		28,300
Total assets			$336,550
Accounts payable			$23,700
Notes payable			68,950
Hannah Freeman, capital			243,900
Total liabilities and owner's equity			$336,550

Freeman obtained appraised values for the land and equipment as follows:

Land	$265,000
Equipment	22,100

An analysis of the accounts receivable indicated that the allowance for doubtful accounts should be increased to $6,900.

Journalize the partnership's entry for Freeman’s investment. For a compound transaction, if an amount box does not require an entry, leave it blank.

	Cash
	Accounts Receivable
	Land
	Equipment
	Allowance for Doubtful Accounts
	Accounts Payable
	Notes Payable
	Hannah Freeman, Capital

Answer 1

Accounts Title and explanations			Debit	Credit
Cash			$42,350
Accounts receivable			$79,600
Land			$265,000
Equipment			$22,100
Accounts payable				$23,700
Allowance for doubtful debts				$6,900
Notes payable				$68,950
Hannah Freeman Capital				$309,500