Terry, Nick, and Frank are forming The Doctor Partnership. Terry is transferring

Question

Terry, Nick, and Frank are forming The Doctor Partnership. Terry is transferring $30,000 of personal cash and equipment worth $25,000 to the partnership. Nick owns land worth $28,000 and a small building worth $75,000, which he transfers to the partnership. There is a long-term mortgage of $20,000 on the land and building, which the partnership assumes. Frank transfers cash of $7,000, accounts receivable of $36,000, supplies worth $3,000, and equipment worth $27,000 to the partnership. The partnership expects to collect $32,000 of the accounts receivable.

Prepare a classified balance sheet for the partnership after the partners’ investments on December 31, 2017. (List current assets in order of liquidity. List Property, Plant and Equipment in order of Land, Buildings and Equipment.)

Assets

Liabilities and Owners’ Equity

THE DOCTOR PARTNERSHIP
Balance Sheet
For the Year Ended December 31 , 2017For the Quarter Ended December 31 , 2017December 31 , 2017

Assets

Current AssetsCurrent LiabilitiesIntangible AssetsLong-term InvestmentsLong-term LiabilitiesProperty, Plant and EquipmentOwners’ EquityTotal AssetsTotal Current AssetsTotal Current LiabilitiesTotal Intangible AssetsTotal LiabilitiesTotal Liabilities and Owners’ EquityTotal Long-term InvestmentsTotal Long-term LiabilitiesTotal Property, Plant and EquipmentTotal Owners’ Equity

    Supplies    Buildings    Terry, Capital    Frank, Capital    Allowance for Doubtful Accounts    Mortgage Payable    Nick, Capital    Equipment    Cash    Accounts Receivable    Land    

$

    Allowance for Doubtful Accounts    Mortgage Payable    Frank, Capital    Accounts Receivable    Nick, Capital    Supplies    Terry, Capital    Land    Buildings    Equipment    Cash    

$

    Add    Less    : Terry, CapitalNick, CapitalFrank, CapitalSuppliesAllowance for Doubtful AccountsCashAccounts ReceivableLandBuildingsEquipmentMortgage Payable

    Supplies    Equipment    Land    Buildings    Mortgage Payable    Terry, Capital    Nick, Capital    Frank, Capital    Cash    Accounts Receivable    Allowance for Doubtful Accounts    

    Current Assets    Current Liabilities    Intangible Assets    Long-term Investments    Long-term Liabilities    Property, Plant and Equipment    Owners’ Equity    Total Assets    Total Current Assets    Total Current Liabilities    Total Intangible Assets    Total Liabilities    Total Liabilities and Owners’ Equity    Total Long-term Investments    Total Long-term Liabilities    Total Property, Plant and Equipment    Total Owners’ Equity    

$

Current AssetsCurrent LiabilitiesIntangible AssetsLong-term InvestmentsLong-term LiabilitiesProperty, Plant and EquipmentOwners’ EquityTotal AssetsTotal Current AssetsTotal Current LiabilitiesTotal Intangible AssetsTotal LiabilitiesTotal Liabilities and Owners’ EquityTotal Long-term InvestmentsTotal Long-term LiabilitiesTotal Property, Plant and EquipmentTotal Owners’ Equity

    Terry, Capital    Nick, Capital    Frank, Capital    Land    Accounts Receivable    Buildings    Cash    Mortgage Payable    Allowance for Doubtful Accounts    Equipment    Supplies    

    Allowance for Doubtful Accounts    Terry, Capital    Mortgage Payable    Frank, Capital    Cash    Accounts Receivable    Supplies    Equipment    Nick, Capital    Land    Buildings    

    Mortgage Payable    Nick, Capital    Supplies    Equipment    Cash    Land    Accounts Receivable    Terry, Capital    Allowance for Doubtful Accounts    Frank, Capital    Buildings    

    Current Assets    Current Liabilities    Intangible Assets    Long-term Investments    Long-term Liabilities    Property, Plant and Equipment    Owners’ Equity    Total Assets    Total Current Assets    Total Current Liabilities    Total Intangible Assets    Total Liabilities    Total Liabilities and Owners’ Equity    Total Long-term Investments    Total Long-term Liabilities    Total Property, Plant and Equipment    Total Owners’ Equity    

Current AssetsCurrent LiabilitiesIntangible AssetsLong-term InvestmentsLong-term LiabilitiesProperty, Plant and EquipmentOwners’ EquityTotal AssetsTotal Current AssetsTotal Current LiabilitiesTotal Intangible AssetsTotal LiabilitiesTotal Liabilities and Owners’ EquityTotal Long-term InvestmentsTotal Long-term LiabilitiesTotal Property, Plant and EquipmentTotal Owners’ Equity

$

Liabilities and Owners’ Equity

Current AssetsCurrent LiabilitiesIntangible AssetsLong-term InvestmentsLong-term LiabilitiesProperty, Plant and EquipmentOwners’ EquityTotal AssetsTotal Current AssetsTotal Current LiabilitiesTotal Intangible AssetsTotal LiabilitiesTotal Liabilities and Owners’ EquityTotal Long-term InvestmentsTotal Long-term LiabilitiesTotal Property, Plant and EquipmentTotal Owners’ Equity

    Allowance for Doubtful Accounts    Buildings    Frank, Capital    Accounts Receivable    Cash    Terry, Capital    Supplies    Land    Equipment    Mortgage Payable    Nick, Capital    

$

Current AssetsCurrent LiabilitiesIntangible AssetsLong-term InvestmentsLong-term LiabilitiesProperty, Plant and EquipmentOwners’ EquityTotal AssetsTotal Current AssetsTotal Current LiabilitiesTotal Intangible AssetsTotal LiabilitiesTotal Liabilities and Owners’ EquityTotal Long-term InvestmentsTotal Long-term LiabilitiesTotal Property, Plant and EquipmentTotal Owners’ Equity

    Terry, Capital    Cash    Equipment    Frank, Capital    Nick, Capital    Accounts Receivable    Mortgage Payable    Allowance for Doubtful Accounts    Land    Buildings    Supplies    

$

    Land    Supplies    Nick, Capital    Accounts Receivable    Allowance for Doubtful Accounts    Terry, Capital    Buildings    Frank, Capital    Equipment    Mortgage Payable    Cash    

    Terry, Capital    Land    Cash    Nick, Capital    Supplies    Frank, Capital    Accounts Receivable    Mortgage Payable    Buildings    Allowance for Doubtful Accounts    Equipment    

    Current Assets    Current Liabilities    Intangible Assets    Long-term Investments    Long-term Liabilities    Property, Plant and Equipment    Owners’ Equity    Total Assets    Total Current Assets    Total Current Liabilities    Total Intangible Assets    Total Liabilities    Total Liabilities and Owners’ Equity    Total Long-term Investments    Total Long-term Liabilities    Total Property, Plant and Equipment    Total Owners’ Equity    

Current AssetsCurrent LiabilitiesIntangible AssetsLong-term InvestmentsLong-term LiabilitiesProperty, Plant and EquipmentOwners’ EquityTotal AssetsTotal Current AssetsTotal Current LiabilitiesTotal Intangible AssetsTotal LiabilitiesTotal Liabilities and Owners’ EquityTotal Long-term InvestmentsTotal Long-term LiabilitiesTotal Property, Plant and EquipmentTotal Owners’ Equity

$

Explanation / Answer

Assets:
Cash: 37,000
Accounts receivable: 68,000
Equipment: 52,000
Building: 75,000
Supplies: 3,000
Land: 28,000

Liabilities:
Mortgage: 20,000
Bad debt reserve: 4,000

Owners' Equity:
terry 100%
nick 0%
frank 0%

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