A, B and C decided to form ABC Partnership. It was agreed that A will contribute an equipment with assessed value of P100,000 with historical cost of P800,000 and accumulated depreciation of P600,000. A day after the partnership formation, the equipment was sold for P 300,000. B will contribute a land and building with carrying amount of P1,200,000 and fair value of P1,500,000. The land and building are subject to a mortgage payable amounting to P300,000 to be assumed by the partnership. The partners agreed that B will have 60% capital interest in the partnership. The partners also agreed that C will contribute sufficient cash to the partnership. What is the total agreed capitalization of the ABC Partnership? What is the cash to be contributed by C in the ABC Partnership?
A, B and C decided to form ABC Partnership. It was agreed that A will contribute an equipment with assessed value of P100,000 with historical cost of P800,000 and accumulated depreciation of P600,000. A day after the partnership formation, the equipment was sold for P 300,000. B will contribute a land and building with carrying amount of P1,200,000 and fair value of P1,500,000. The land and building are subject to a mortgage payable amounting to P300,000 to be assumed by the partnership. The partners agreed that B will have 60% capital interest in the partnership. The partners also agreed that C will contribute sufficient cash to the partnership. What is the total agreed capitalization of the ABC Partnership? What is the cash to be contributed by C in the ABC Partnership?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:A, B and C decided to form ABC Partnership.
It was agreed that A will contribute an
equipment
with assessed value of P100,000 with
historical cost of P800,000 and accumulated
depreciation of
P600,000. A day after the partnership
formation, the equipment was sold for P
300,000.
B will contribute a land and building with
carrying amount of P1,200,000 and fair value
of
P1,500,000. The land and building are subject
to a mortgage payable amounting to
P300,000 to be
assumed by the partnership. The partners
agreed that B will have 60% capital interest in
the
partnership. The partners also agreed that C
will contribute sufficient cash to the
partnership.
What is the total agreed capitalization of the
ABC Partnership?
What is the cash to be contributed by C in the
ABC Partnership?
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