The balance sheet of Sade & Tipp LLP on April 30, 2006, was as follows:
The partnership was converted to S & T Corporation, with new accounting records. Sade and Tipp received a total of 10,000 shares of $1 par common stock in exchange for the net assets of the partnership. The accounting records of the partnership had been maintained in accordance with generally accepted accounting principles, except that an allowance for doubtful accounts of $800 had not been provided. The current fair values of the inventories and equipment were $28,000 and $35,000, respectively. Sade and Tipp shared net income and losses in a 3:2 ratio, respectively.
Prepare journal entries for S & T Corporation on April 30, 2006, to record the transfer of net assets from the partnership and the issuance of common stock to the partners.

Question

The balance sheet of Sade & Tipp LLP on April 30, 2006, was as follows:
  The partnership was converted to S & T Corporation, with new accounting records. Sade and Tipp received a total of 10,000 shares of $1 par common stock in exchange for the net assets of the partnership. The accounting records of the partnership had been maintained in accordance with generally accepted accounting principles, except that an allowance for doubtful accounts of $800 had not been provided. The current fair values of the inventories and equipment were $28,000 and $35,000, respectively. Sade and Tipp shared net income and losses in a 3:2 ratio, respectively.
Prepare journal entries for S & T Corporation on April 30, 2006, to record the transfer of net assets from the partnership and the issuance of common stock to the partners.

Quizplus · Accepted Answer

The Answer of The balance sheet of Sade & Tipp LLP on April 30, 2006, was as follows:
  The partnership was converted to S & T Corporation, with new accounting records. Sade and Tipp received a total of 10,000 shares of $1 par common stock in exchange for the net assets of the partnership. The accounting records of the partnership had been maintained in accordance with generally accepted accounting principles, except that an allowance for doubtful accounts of $800 had not been provided. The current fair values of the inventories and equipment were $28,000 and $35,000, respectively. Sade and Tipp shared net income and losses in a 3:2 ratio, respectively.
Prepare journal entries for S & T Corporation on April 30, 2006, to record the transfer of net assets from the partnership and the issuance of common stock to the partners.

The Balance Sheet of Sade & Tipp LLP on April