Holly Renfro contributed a patent, accounts receivable, and $21,320 cash to a partnership. The patent had a book value of $8,420. However, the technology covered by the patent appeared to have significant market potential. Thus, the patent was appraised at $92,790. The accounts receivable control account was $40,400, with an allowance for doubtful accounts of $1,900. The partnership also assumed a $9,700 account payable owed to a Renfroâs supplier.
Required:
1. On December 31, provide the journal entry for Renfroâs contribution to the partnership. Refer to the Chart of Accounts for exact wording of account titles.