As is the case with all entities, the investment of capital in a partnership should initially be measured at what value:

Question

Quizplus · Accepted Answer

When it comes to measuring the initial investment of capital in a partnership, the best choice is fair market value. This is because fair market value provides the most accurate representation of the actual value of the capital being invested. Book value can be manipulated and may not reflect the true value of the assets, while labor and asset values may not necessarily reflect the actual cash invested. Therefore, fair market value is the most appropriate measure for the initial investment of capital in a partnership.

As Is the Case with All Entities, the Investment of Capital