Robert Johnson Contributed Equipment, Inventory, and $42,000 Cash to the Partnership

Robert Johnson contributed equipment, inventory, and $42,000 cash to the partnership. The equipment had a book value of $25,000 and market value of $28,000. The inventory has a book value of $50,000, but only had a market value of $15,000 due to obsolescence. The partnership also assumed a $12,000 note payable owed by Robert that was originally used to purchase the equipment. What amount should Robert's capital account be recorded?

A) $85,000
B) $73,000
C) $117,000
D) $105,000

Correct Answer:

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