16. Abelardo, Baligod and Cabatingan are partners with average capitalbalances during 2020 of P378,000, P190,920, and P129,880, respectively.The partners receive 10% interest on their average capital balances; afterdeducting salaries of P97,860 to Abelardo and P66,100 to Cabatingan, theresidual profits or loss is divided equally. In 2020, the partnership had a netloss of P100,499.20 before the interest and salaries to partners. By whatamount should Abelardo's and Cabatingan's capital account changeincrease (decrease)?Abelardoa. 24,213.60Cabatingan(32,358.40)14,029b.23,581C.(32,675)24,98825,966d.22,686

The partnership comes into existence when two or more persons agree to do the business and share…

Answered: 5. Abelardo, Baligod and Cabatingan are…

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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On October 1, 2021, Pamu and Kevin formed a partnership and agreed to share profits and lossesin the ratio of 3:7, respectively. Balances of capital accounts should be in accordance with the profitand loss percentage on the date of partnership formation. Pamu contributed a parcel of land that costher P200,000. Kevin contributed P300,000 cash. The land has a quoted price of P360,000 on October1, 2021. What amount should be recorded in Pamu’s capital account upon formation of thepartnership assuming the use of bonus method? a. P150,000b. P198,000c. P200,000d. P360,000
Jen, Raks, and Fred are partners with average capital balances during 20x9 of P945,000, P477,300, and P324,700, respectively. The partners receive 10% interest on their average capital balances; after deducting salaries of P244,650 to Jen and P165,250 to Fred, the residual profits or loss is divided equally. In 2019, the partnership had a net loss of P251,248 before the interest and salaries to partners. By what amount should Jen's and Fred's capital account change increase (decrease) ? Change in the Capital of Jen should be answered first, followed by the change in Fred's Capital
Energetic and Faithful decided to form a partnership on June 1, 2021 by investing P100,000 and P150,000 respectively. They agreed that profits are to be divided as follows: • Partners are to receive a 10% interest on beginning capital. • Each partner is to receive an annual salary of P24,000. Energetic, the managing partner, is to receive a bonus equivalent to 10% of the net income after interest, salaries and bonus. • The remaining profit is to be divided equally. Energetic invested P50,000 on August 1 and withdrew cash amounting to P10,000 on December 1. Faithful invested P15,000 on September 1 and withdrew cash amounting to 5,000 in November 1. During the year, the partnership had a net income of P80,000. How much is the share of Energetic in the net income?
-X. Y, and Z formed a partnership on Jnauary 1, 2021, and contributed P150,0003; P200,000; P300,000, respectively. Their articles of co-partnership provide that the operating income be shared among partners as follows: as salary, P24,000 for X; P18,000 for Y; and P12,000 for Z; interest of 12% on the average capital during 2021 of the three partners; and the remainder in the ratio of 4:2:4, respectively. The operating income for the year-end December 31, 2021 amounted to P200,000. X contributed additional capital of P30,000 on July 1, and made a drawing of P10,000 on October 1; Y contributed additional capital of P20,000 on August 1, and made a drawing of P10,000 on October 1; and Z made a drawing of P30,000 on November 1, 2021. How much is the shared profit of partner Z? *
On January 1, 2021, Hinata, Tsukki and Kageyama formed Haikyu Partnership with a total agreed capitalization of P1,000,000. The capital interest ratio of the Haikyu Partnership is 5:1:4 while the profit or loss ratio is 6:2:2, respectively for Hinata, Tsukki, and Kageyama. During 2021, Hinata and Tsukki made additional investments of P200,000 and P500,000, respectively. At the end of 2021, Hinata and Kageyama made drawings of P300,000 and P100,000, respectively. On December 31, 2021, the capital balance of Kageyama is reported at P250,000. How much is the total equity at the end of the year?
X and Y are partners sharing profits 6:4, respectively. Capital accounts as of October 1, 2021 are X-P 560,000; Y-P 480,000. They agree to admit Z as a new partner with an investment of P260,000 for a interest in the partnership and that the assets are fairly valued, what would be the capital of Y after the admission of Z?
A, B, and C are partners with present capital balances of P40,000, P50,000, and P20,000, respectively. The partners share profits and losses according to the following percentages: 60% for A, 30% for B, and 10% for C. D is to join the partnership upon contributing P40,000 to the partnership in exchange for a 25% interest in capital and a 20% interest in profits and losses. An appraisal of the existing partnerships' assets reveals the following: Accounts Receivable P20,000 overvalued Inventory P10,000 overvalued Land P10,000 undervalued Building P15,000 undervalued Calculate the capital balances for each individual in the new partnership assuming use of the bonus method.
A and B agreed that they will receive annual salaries of P60,000 each. Bonus shall be given to A of 20% of the net income after partners' salaries, the bonus being treated as an expense. Balance will be divided equally. The partnership reported a net income of P360,000 after partners' salaries but before bonus. How much is the share of B in the profit?
Ann, Beth, Chris and Dan are equal partners in the ABCD. They have agreed that all items of partnership income, gain, loss and deduction will be split equally between them. In addition, since Ann is expected to be rendering the majority of the services on behalf of the partnership, the partners have agreed that she will receive $3,000 per month in addition to her 25% distributive share. For the year 2020, the partnership had short-term capital loss of $28,000, long-term capital gain of $54,000 and bottom line ordinary income (before considering the additional payments to Ann) of $21,000. What is the amount and character of partnership income and loss that Ann, Beth, Chris and Dan must include from the ABCD partnership on their 2020 income tax returns?
Part II: Problems 1. On January 1, 2021, Kaye, Erika and April formed a partnership with original capital contribution ratio or 4:5:1 for total agreed capitalization of P5,000,000. The profit or loss ratio agreement provides that profits shall be distributed in the ratio of 3:2:5 while losses shall be distributed in the ratio of 6:1:3. During 2021, the partnership reported net income of P2,000,000 with Kaye and Erika withdrawing P500,000 and P300,000, respectively. During 2022, the partnership reported net loss of P1,000,000 with Erika and April withdrawing P200,000 and P400,000 respectively. What is the adjusted capital balances of each partner on December 31, 2022?
Saud, Salim and Sulaimon started a partnership firm on January 1, 2019. They contributed RO. 50,000, RO. 40,000 and RO. 30,000 respectively as their capitals and decided to share profits in the ratio of 3:2:1. The partnership deed provided that Saud is to be paid salary of RO. 12000 p.a. and Salim commission of RO. 2,500 every 6 months. It also provided that interest on capital be allowed @ 6% p.a. The drawings for the year were: Saud RO. 6,000, Salim RO. 4,000 and Sulaimon RO. 2,000. Interest on drawings was RO. 270 for Saud, RO.180 for Salim and RO. 90 for Sulaimon. The net amount of profit as per the profit and loss account for the year ended 2019 was RO. 35,660. Prepare the necessary accounting entries, the profit and loss appropriation account and the partners' capital accounts Identify which one of the following accounting entry for payment of salary to partner Saud at the end of the year: a. Dr: Saud's salary account RO 1000Cr: Saud's capital account RO 1000 b. Dr: Saud's…
X and Y are partners sharing profits 6:4, respectively. Capital accounts as of October 1, 2021 are: X-P 560,000, YP 480,000. They agree to admit Z as a new partner with an investment of P260,000 for a ¼ interest in the partnership and that the assets are fairly valued, what would be the capital of Y after the admission of Z?

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