A and B are partners of AB Partnership sharing profits and losses in the ratio 4:6. Their capital balances are P400,000 and P600,000, respectively. On October 1, 2019, upon mutual agreement of Partner A and Partner B, Partner C was admitted to the partnership, under different assumptions. Case a. C purchased one-half (1/2) of A’s interest for P250,000. b. C purchased one-third (1/3) of B’s interest for P150,000. c. C purchased one-fourth (1/4) of a partnership interest for P350,000.
A and B are partners of AB Partnership sharing profits and losses in the ratio 4:6. Their capital balances are P400,000 and P600,000, respectively. On October 1, 2019, upon mutual agreement of Partner A and Partner B, Partner C was admitted to the partnership, under different assumptions. Case a. C purchased one-half (1/2) of A’s interest for P250,000. b. C purchased one-third (1/3) of B’s interest for P150,000. c. C purchased one-fourth (1/4) of a partnership interest for P350,000.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
A and B are partners of AB Partnership sharing
On October 1, 2019, upon mutual agreement of Partner A and Partner B,
Partner C was admitted to the partnership, under different assumptions.
Case a. C purchased one-half (1/2) of A’s interest for P250,000.
b. C purchased one-third (1/3) of B’s interest for P150,000.
c. C purchased one-fourth (1/4) of a partnership interest for P350,000.
d. C purchased one-half (1/2) interest of Partners A and B by paying
P600,000.
Requirement:
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