On June 1, 2020, Jill Bow and Aisha Adams formed a partnership to open a...
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On June 1, 2020, Jill Bow and Aisha Adams formed a partnership to open a gluten-free commercial bakery, contributing $285,000 cash and $370,000 of equipment, respectively. The partnership also assumed responsibility for a $45,000 note payable associated with the equipment. The partners agreed to share profits as follows: Bow is to receive an annual salary allowance of $155,000, both are to receive an annual interest allowance of 10% of their original capital investments, and any remaining profit or loss is to be shared 40/60 (to Bow and Adams, respectively). On November 20, 2020, Adams withdrew cash of $105,000. At year-end, May 31, 2021, the Income Summary account had a credit balance of $430,000. On June 1, 2021, Peter Williams invested $125,000 and was admitted to the partnership for a 20% interest in equity. Required: 1. Prepare journal entries for the following dates. ok at a. June 1, 2020 View transaction list Journal entry worksheet 1 Record the formation of partnership. Note: Enter debits before credits. Date General Journal Debit Credit June 01, 2020
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