Response to the following problem:
Lynn Goodman, sole proprietor of hardware business decides to form a patnershipwith Ned Johns. Lynn's accounts are as follows:
Book Value Agreed Market Value
Cash 30,000 30,000
Accounts Receivable 55,000 45,000
Inventory 112,000 135,000
Land 40,000 100,000
Building (net) 500,000 540,000
Accounts Payable 25,000 25,000
Mortgage Payable 125,000 125,000
Ned agrees to contribute 120,000 for a 20% interest. Journalize the entries to record
(a) Lynn's Investment
(b) Ned's Investment.