L. Hill invests the following assets in a new partnership: $15,000 in cash, and equipment that cost $30,000 but has a book value of $17,000 and fair market value of $20,000. Hill, Capital will be credited for $32,000.

Question

Quizplus · Accepted Answer

The total value of assets invested by Hill is $35,000 (cash + fair market value of equipment). However, the capital account is only credited for $32,000. Therefore, the statement is false.

L Hill Invests the Following Assets in a New Partnership