PARTNERSHIP FORMATION 1. Triangle, Square and Round formed a partnership. Trianglecontributed cash of P80,000. Square contributed equipmentwith historical cost of P700,000, carrying amount of P180,000,and fair value of P90,000. Round contributed building withhistorical cost of P1,000,000, carrying amount of P480,000 andfair value of P690,000. The partnership will assume the unpaidmortgage of P580,000 on the building. Which partner has theleast capital account balance on partnership formation?a. Triangleb. Squarec. Roundd. None, all are equal

Partnership is an agreement or arrangement between two or more than two persons who invest capital…

Answered: 1. Triangle, Square and Round formed a…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Question

PARTNERSHIP FORMATION

1. Triangle, Square and Round formed a partnership. Triangle
contributed cash of P80,000. Square contributed equipment
with historical cost of P700,000, carrying amount of P180,000,
and fair value of P90,000. Round contributed building with
historical cost of P1,000,000, carrying amount of P480,000 and
fair value of P690,000. The partnership will assume the unpaid
mortgage of P580,000 on the building. Which partner has the
least capital account balance on partnership formation?
a. Triangle
b. Square
c. Round
d. None, all are equal

Definition Definition Arrangement between two or more people whereby they agree to manage business operations and share its profits and losses in an agreed ratio. The agreement drafted and signed by the partners of the firm is termed as a partnership deed and contains various important clauses agreed between the partners such as profit/loss sharing, interest on capital, remuneration allocation of each partner, and drawings of a partner.

Expert Solution

Trending now

This is a popular solution!

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions