Wiley CPA FAR MCQ: Partnership Accounting

The following FAR question is from the Wiley CPA Test Bank for FAR.

A partnership is formed by two individuals who were previously sole proprietors.  Property other than cash which is part of the initial investment in the partnership would be recorded for financial accounting purposes at the

A: Proprietor’s book values or the fair value of the property at the date of the investment, whichever is higher.

B: Proprietor’s book values or the fair value of the property at the date of the investment, whichever is lower.

C: Proprietors’ book values of the property at the date of the investment.

D: Fair value of the property at the date of the investment.