Fontaine and Monroe are forming a partnership. Fontaine invests in a building th
ID: 2565543 • Letter: F
Question
Fontaine and Monroe are forming a partnership. Fontaine invests in a building that has a market value of $348,000; the partnership assumes responsibility for a $124,000 note secured by a mortgage on the property. Monroe invests $99,000 in cash and equipment that has a market value of $74,000. For the partnership, the amounts recorded for Fontaine's Capital account and for Monroe's Capital account are:
A. Fontaine, Capital $224,000; Monroe, Capital $173,000.
B. Fontaine, Capital $224,000; Monroe, Capital $99,000.
C. Fontaine, Capital $224,000; Monroe, Capital $74,000.
D. Fontaine, Capital $348,000; Monroe, Capital $173,000.
E. Fontaine, Capital $348,000; Monroe, Capital $99,000.
Please add explanation
Fontaine and Monroe are forming a partnership. Fontaine invests in a building that has a market value of $348,000; the partnership assumes responsibility for a $124,000 note secured by a mortgage on the property. Monroe invests $99,000 in cash and equipment that has a market value of $74,000. For the partnership, the amounts recorded for Fontaine's Capital account and for Monroe's Capital account are:
A. Fontaine, Capital $224,000; Monroe, Capital $173,000.
B. Fontaine, Capital $224,000; Monroe, Capital $99,000.
C. Fontaine, Capital $224,000; Monroe, Capital $74,000.
D. Fontaine, Capital $348,000; Monroe, Capital $173,000.
E. Fontaine, Capital $348,000; Monroe, Capital $99,000.
Please add explanation
Explanation / Answer
Calculate the amounts recorded for Fontaine's Capital account and for Monroe's Capital account are
so answer is a) Fontaine, capital $224000; Monroe, capital $173000
Fontaine capital Monroe Capital Building 348000 Less: Mortgage (124000) Cash 99000 Equipment 74000 Total 224000 173000