A, B and C are partners in a business being liquidated. The capital balance of PV after admission of JP is:Ī. The partnership had net income of P210,000 before admission of JP and the partners agree to revalue its overvalued equipment by P35,000. On July 1, 2013, JP was admitted by the partnership for 20% interest in capital and 25% in profits by contributing P87,500 cash, and the old partners agreed to bring their interest to their old capital and profit interest sharing ratio. Their profit ratio is 5:3:2 while their capital interest ratio is 4:4:2. PV, BK and TF were partners with capital balances on Januof P350,000, P525,000 and P700,000, respectively. The amount of bonus in the admission of AX would be:A. The partners agreed to distribute profits as follows: Annual salaries to CD and NH of P50,000 each Annual interest of 5% on beginning capital Bonus of 15% to CD based on income after salaries, interest and bonus Remaining profit: 25% to CD, 35% to NH and 40% to GV The following Statement of Financial Position for the Partnership of CD, NH and GV were taken from the books on October 1, 2013.AssetsLiabilities and CapitalCashP100,000LiabilitiesP200,000Other Assets 400,000CD, Capital 120,000 NH, Capital 95,000 GV, Capital 85,000Total Assets500,000Total Liabilities and Capital500,000 After admission of AX, the total capital will be P3,465,000 and AX capital will be P735,000. AX will be given a 20% share in profits, while the original partners share will be proportionately the same as before. On January 1, 2013, the partners admitted AX as a new partner and according to their agreement AX will contribute P840,000 in cash to the partnership and also pay P105,000 for 15% of SRs share. PJ, SR and MJ are partners sharing profits and losses of 5:3:2, respectively. What is the amount of cash presented on the partnerships Statement of Financial Position on December 1, 2013.Ī. MG and AN are to invest equal amounts of cash such that the contribution of MG would be 10% more than the investment of AN. Cash and noncash assets are to be contributed. On December 1, 2013, MG and AN are combining their separate businesses to form a partnership. If the capital balances of AB before and after adjustment were P695,000 and P605,000 respectively, what is the effect in the carrying value of the equipment as a result of the admission of MZ?Ī. After that, MZ is to invest additional pieces of equipment to make her interest equal to 45%. MZ agreed provided that AB will adjust the accumulated depreciation of his Equipment account to a certain amount, and will recognize additional accrued expenses of P50,000. On December 1, 2012, AB invited MZ to join him in his business. What is the fair value of the equipment invested by MV?A.
CD unsuccessfully defended the case and the final decision of the court was released on November 29, 2013. Part of the intangibles is a patent with a carrying value of P56,000 which was sued upon by a competitor. Included in the machineries is an obsolete apparatus acquired for P384,000 with an accumulated depreciation balance of P336,000.
Inventories are to be written down to P1,040,000. P32,000 of the accounts receivable are proven uncollectible. The assets invested by CD are not properly valued. CD invested some assets which are shown below.Book Value MV invested P3,120,000 cash and a piece of equipment. On DecemMV and CD agreed to invest equal amounts and share profits equally to form a partnership. The partnership agreement provides for a profit and loss ratio of 70% to AK and 30% to BK.Assuming the use of transfer of capital method, how much is the agreed capital of AK to bring the capital balances proportionate to their profit and loss ratio.Ī. Inventories of P21,875 and P15,312.50 are worthless in the books of AK and BK respectively. Allowance for doubtful account is to be set up amounting to P297,500 for AK and P196,875 for BK. They agreed to have the following adjustments shall be made: Equipment of AK is underdepreciated by P87,500 and that BK is overdepreciated by P131,250. AK and BK decided to form a partnership on October 1, 2013.
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