17. On January 31, 2021, partners of Lon, Mac & Nan, LLP, had the following loan and capital account balances (after closing entries for January): Loan receivable from Lon. . P 20,000 dr P 60,000 cr Loan payable to Nan. . Lon, Capital. Mac, Capital . Nan, Capital. P 30,000 cr P120,000 cr P70,000 cr The partnership's income sharing ratio was Lon, 50%, Mac, 20%, and Nan 30%. On January 31, 2021, Ole was admitted to the partnership for a 20% interest in total capital of the partnership in exchange for an investment of P40,000 cash. Prior to Ole's admission, the existing partners agreed to increase the carrying amount of the partnership's inventories to current fair value, a P60,000 increase. The capital account to be credited to Ole: a. P60,000 О Б. Р40,000 O c. с. Р52,000 O d. P46,000
17. On January 31, 2021, partners of Lon, Mac & Nan, LLP, had the following loan and capital account balances (after closing entries for January): Loan receivable from Lon. . P 20,000 dr P 60,000 cr Loan payable to Nan. . Lon, Capital. Mac, Capital . Nan, Capital. P 30,000 cr P120,000 cr P70,000 cr The partnership's income sharing ratio was Lon, 50%, Mac, 20%, and Nan 30%. On January 31, 2021, Ole was admitted to the partnership for a 20% interest in total capital of the partnership in exchange for an investment of P40,000 cash. Prior to Ole's admission, the existing partners agreed to increase the carrying amount of the partnership's inventories to current fair value, a P60,000 increase. The capital account to be credited to Ole: a. P60,000 О Б. Р40,000 O c. с. Р52,000 O d. P46,000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Transcribed Image Text:17. On January 31, 2021, partners of Lon, Mac & Nan, LLP, had the following loan and capital
account balances (after closing entries for January):
Loan receivable from Lon. .
Loan payable to Nan..
Lon, Capital .
Mac, Capital.
Nan, Capital..
P 20,000 dr
P 60,000 cr
P 30,000 cr
P120,000 cr
P70,000 cr
..... .
The partnership's income sharing ratio was Lon, 50%, Mac, 20%, and Nan 30%. On January 31,
2021, Ole was admitted to the partnership for a 20% interest in total capital of the partnership
in exchange for an investment of P40,000 cash. Prior to Ole's admission, the existing partners
agreed to increase the carrying amount of the partnership's inventories to current fair value, a
P60,000 increase. The capital account to be credited to Ole:
а. Р60,000
b. P40,000
с. Р52,000
d. P46,000
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