10. As of July 1, 2020, Somine and Tamayo decided to form a partnership. Theirbalance sheets on this date are:TamayoP37,500225,000202,500270,000P705,000 P735,000P135,000 P240,000SomineP15,000540,000CashAccounts receivableMerchandise inventoryMachinery and equipment 150,000TotalAccounts payableSomine, capitalTamayo, capital570,000495,000P705,000 P735,000TotalThe partners agreed that the machinery and equipment of Somine is under-depreciated by P15,000 and that of Tamayo by P45,000. Allowance fordoubtful accounts is to be set up amounting to P120,000 for Somine andP45,000 for Tamayo. The partnership agreement provides for a profit andloss ratio and capital interest of 60% to Somine and 40% to Tamayo. Howmuch cash must Somine invest to bring the partners' capital balancesproportionate to their profit and loss ratio?a. P142,500b. P52,500C. P172,500d. P102,500

Partnership is an agreement or association between two or more than two persons, in which they…

Answered: 10. As of July 1, 2020, Somine and…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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3.On march 1, 2015, the capital account of fish would sbow a blance of: 2. Assuming that the partners agreed to bring thier respective capital in proportion to thuer respectuve profit and loss ratio, and using fish capital as the base, how much cash is to be invested by cat?
On July 1, 2020, Wency and William agreed to form a partnership from their respective proprietorship businesses and to share profits equally. Wency and William’s balance sheet before the formation were: Wency William Cash P 6,000 P 15,000 Accounts receivable 36,000 21,000 Merchandise inventory 99,000 126,000 Prepaid rent 12,000 Store equipment 120,000 90,000 Accum. Depreciation ( 45,000) ( 54,000) Building 375,000 Accum. Depreciation (75,000) Land 180,000 - Totals P 696,000 P 210,000 Accounts payable P 22,500 P 9,000 Mortgage payable 180,000 - Capital 493,500 201,000 Totals P 696,000 P 210,000 The fair values of Wency’s and William’s assets were: Wency William Merchandise inventory P 81,000 P 135,000 Prepaid rent - 0 Store equipment 45,000 19,500 Building 750,000 -…
11. On June 30, 2015, the balance sheet of Western Marketing, a partnership, is summarized as follows: Sundry assets 150,000 West, capital 90,000 Tern, capital 60,000 West and Tern share profits and losses at a 60:40 ratio, respectively. They agreed to take in Cuba as a new partner, who purchases 1/8 interest of West and tern for P25,000. What is the amount of Cuba's capital to be taken up in the partnership books if book value method is used?
The following information relates to partner for the year ended 29 February 2020: Current account credit balance on 29 February 2020 20 000 Profit share 50 000 Salaries 180 000 Interest on capital 24 000 Drawings 220 000 Interest on drawings 2 000 What is the balance in the Current account of the partner on 01 March 2019? A. R12 000 DR O B. R116 000 DR OC. R52 000 CR O D. R12 000 CR
9. On January 1, 2016, AB and QR agreed to form a partnership. The following are their assets and liabilities. Accounts QR P76,000 88,000 48,000 304,000 364,000 480,000 440,000 216,000 144,000 140,000 60,000 Cash Accounts Receivable Inventories Machinery. Accounts Payable Notes Payable AB P136,000 AB decided to pay-off his notes payable from his personal assets. It was also agreed that QR inventories were overstated by P24,000 and AB machinery was over-depreciated P20,000. QR is to invest/withdraw cash in order to receive a capital credit that is 20% more than AB's total net investment in the partnership. Immediately after formation, how much cash will be presented in the partnership' Statement of Financial Position? 9
The balance sheet for Coney, Honey, and Money partnership shows the following information as of December 31, 2015; Cash ₱40,000 Liabilities ₱100,000 Other assets 560,000 Coney, Loan 50,000 Coney, Capital 250,000 Honey, Capital 140,000 Money, Capital 60,000 ₱600,000 ₱600,000 Profit and loss ratio is 3:2:1 for Coney, Honey, and Money, respectively. Other assets were realized as follows: DATE CASH RECEIVED BOOK VALUE January 2016 ₱120,000 ₱180,000 February 2016 70,000 154,000 March 2016 250,000 226,000 Cash is distributed as assets are realized. Cash received by Money in January is: a.P4,000 b. P10,000 c. P20,000 d. None
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On June 1, 20x10, HEAD and ACHE decided to form a partnership contributing their existing businesses. The following is taken form their trial balance: HEAD ACHE Cash 250,000 150,000 Receivables (net) 100,000 80,000 Inventory 125,000 150,000 500,000 400,000 Fixed Assets (net) Liabilities 250,000 250,000 The partners agreed on the following: 1. P50,000 of HEAD'S cash represents converted foreign currencies amounting to FC1,000 on December 31, 20x9. The current spot rate of FC1 is equivalent to P53. 2. The receivables of HEAD and ACHE, currently have a net realizable value of 80% it is agreed that their net realizable value must be adjusted to 75%. 3. HEAD's inventory has a NRV of P140,000 and could be currently sold for P200,000. HEAD's machine was purchased last year with a 5-year life. It's estimated current value is 90% of its cost. 5. ACHE's fixed asset has an 80% condition percentage. If bought brand new, its price would be P550,000. 6. The partners are to share in profits and…
The A Company whose ending capital is P89,000 will be joined by Mr. B to form a partnership. Mr. B is to invest sufficient cash to have 30% interest in capital and in interest after following the following adjustment of the accounts of The A Company: Merchandise inventory will be increased by P3,500, supplies amounting to P2,500 is fully consumed and the Equipment purchased for P61,000 which has a book value P55,000 should be 90% depreciated. B is to invest?
On June 30, 2015, the balance sheet of Western Marketing, a partnership, is summarized as follows: Sundry assets West, capital 150,000 90,000 60,000 Tern, capital West and Tern share profits and losses at a 60:40 ratio, respectively. They agreed to take in Cuba as a new partner, who purchases 1/8 interest of West and tern for P25,000. What is the amount of Cuba's capital to be taken up in the partnership books if book value method is used? O 12500 O 18750 O 25000 O 31250
10. The partners' capital (income-sharing ratio in parentheses) of Acosta, Bautista, Campos, & Dela Cruz LLP on May 31, 2020, was as follows: P195,000 Acosta (20%) Bautista (20%) Campos (20%) Dela Cruz (40%) Total partners' capital (20%) P812,500 260,000 227,500 130,000 On May 31, 2020, with the consent of Acosta, Bautista, and Dela Cruz: a. Sam Campos retired from the partnership and was paid P162,500 cash in full settlement of his interest in the partnership. b. Lois Elon was admitted to the partnership with a P65,000 cash investment for a 10% interest in the net assets of Acosta, Bautista, Dela Cruz & Elon LLP. The capital account to be credited to Elon: a. P71,500 b. P87,750 C. P65,000 d. P81,250 194
Items 18 to 20 are based on the following data. The partnership business of John Estrada and Peter Arroyo was formed on January 2, 2020. At that date, the following assets were invested as derived from their respective sole proprietor's books. Book of Estrada Book of Arroyo 160,000 Cash. .P145,000 Accounts receivable. 80,000 50,000 Allowance for doubtful accounts. (5,000) (3,000) Merchandise inventory. 200,000 190,000 Partner's agreement as follows: 1. Estrada and Arroyo's adjusted capital contributions must be equal. In the event that one's contribution will exceed the other, any one of them shall withdraw "Cash" from their respective investment. 2. Their respective Accounts receivable should have a probability of collections. 80% for Estrada and 90% for Arroyo. 3. Merchandise inventory will be caried in the partnership book "as is". 4. Prepaid expense of P20,000 should be recognized for Estrada and P5,000 Accrued expenses for Arroyo. 18. How much is the adjusted capital contribution…

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