Brian and Sandy are forming a partnership. Brian will invest a truck with a book value of $10000 and a fair value of $14000. Sandy will invest a building with a book value of $30000 and a fair value of $42000 with a mortgage of $15000. At what amount should the building be recorded?

Question

Quizplus · Accepted Answer

The building should be recorded at its fair value of $42000, as investments in a partnership are recorded at fair value at the time of investment.

Brian and Sandy Are Forming a Partnership