Answered

Westonci.ca offers quick and accurate answers to your questions. Join our community and get the insights you need today. Our Q&A platform offers a seamless experience for finding reliable answers from experts in various disciplines. Our platform offers a seamless experience for finding reliable answers from a network of knowledgeable professionals.

On May 1, Cobb and Mott formed a partnership and agreed to share profits and losses in the ratio of 3:7, respectively. Cobb contributed a parcel of land that cost him $10,000. Mott contributed $40,000 cash. The land was sold for $18,000 on that same date, immediately after formation of the partnership. What amount should be recorded in Cobb's capital account on formation of the partnership

Sagot :

Answer: $18000

Explanation:

We should note that the value of the contributed assets would be based on the fair values.

With regards to the question, we are already informed that the land was sold for $18,000 which in this case is the fair value of the asset.

Therefore, the amount that should be recorded in Cobb's capital account on formation of the partnership would be $18000.

We appreciate your visit. Our platform is always here to offer accurate and reliable answers. Return anytime. We hope you found this helpful. Feel free to come back anytime for more accurate answers and updated information. Find reliable answers at Westonci.ca. Visit us again for the latest updates and expert advice.