Use the following information for numbers 13 to 18. The capital accounts of Sonia and Olga partnership on January 1, 2018 were: Partners Capitals P&L Ratio Sonia 112,000 75% Olga 48,000 25% On October 1, 2018, Thess was admitted for a 40% interest in the partnership when she purchased 40% of each existing partner's capital for P80,000, paid directly to Sonia and Olga. The partnership's net income for the year is P66,000 and 2/3 of it was earned in the last quarter of the year. What are the balances of all partners after Thess's admission to the partnership? 13. Sonia. 14. Olga. 15. Thess. 16. How much will Sonia receive from the above transaction? 17. Assume that Thess is admitted by investing P80,000 into the partnership for a 40% interest, how much is the ending capital balance of Olga after the admission? 18. Assume that Thess is admitted by investing P80,000 into the partnership for a 40% interest, how much is the bonus (given)/received to/from Thess after the admission?

Use the following information for numbers 13 to 18. The capital accounts of Sonia and Olga partnership on January 1, 2018 were: Partners Capitals P&L Ratio Sonia 112,000 75% Olga 48,000 25% On October 1, 2018, Thess was admitted for a 40% interest in the partnership when she purchased 40% of each existing partner's capital for P80,000, paid directly to Sonia and Olga. The partnership's net income for the year is P66,000 and 2/3 of it was earned in the last quarter of the year. What are the balances of all partners after Thess's admission to the partnership? 13. Sonia. 14. Olga. 15. Thess. 16. How much will Sonia receive from the above transaction? 17. Assume that Thess is admitted by investing P80,000 into the partnership for a 40% interest, how much is the ending capital balance of Olga after the admission? 18. Assume that Thess is admitted by investing P80,000 into the partnership for a 40% interest, how much is the bonus (given)/received to/from Thess after the admission?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

The Prince Robbins partnership has the following capital balance on January 1, 2018 Prince capital $70,000 Robbins capital 60,000 Prince is allocated 80% of all profits and losses with the remaining 20% assigned to Robbins afterinterest of 10% is given to each partner based on beginning capital balances. On January 2, 2018 Jeffrey invests $37,000 in cash for a 20% interest in the partnership. this is recorded goodwill method. After this transaction 10% interest is still to go to each partner. Profits and losses willthen be split as follows: 50% Prince, 30% Robbins and 20% Jeffrey In 2018 the partnership reports a net income of $15,000 Prepare a journal entry to record Jeffrey's entrance into the partnership on January 2, 2018 Deermine the allocation of income at the end of 2018.
Partners Lusteno and Advincula receive a salary of P150,000 respectively, and share profit and losses in a 2:1 ratio, respectively: if the partnership suffered a P150,000 loss in 2018, by how much would Lusterio's account decrease? a. P400,000 b. P250,000 c. P200,000 d. P100,000
A, B and C are in partnership sharing profits and losses in the ratio of 5:3:2. On 1st Jan 2017, their capital balances are: RO A 75000 B 45000 C 30000 The terms of partnership provide that: All partners are eligible for interest on capital @5% All partners are liable to pay interest on drawings @ 6% Partner A is eligible for salary @ RO 150 per month The net profit for the year ended 31st December, 2017 before making the above terms was RO 46400. The drawings of the partners were: RO A 6000 B 4000 C 2000 You are required to prepare: - Profit and Loss…
Deadshot, Harley Quinn, and El Diablo are partners sharing profits and losses in the ratio of 5:3:2. At the beginning of the year 2018, they admit Captain Boomerang, who is to invest sufficient cash to give one-third interest in the capital and earnings of the partnership. The balance sheet of the partnership before the admission of Captain Boomerang is presented below: Cash 4,500,000 10,125,000 3,375,000 Liabilities 2,250,000 1,350,000 7,875,000 4,500,000 2,025,000 18,000,000 Receivables Deadshot, loan Deadshot, capital Harley Quinn, capital El Diablo, capital Inventories Total 18,000,000 The partners agree to revalue the inventories at its net realizable value of P2,250,000 and an allowance for doubtful accounts of P1,125,000 is to be set up by the partnership against the receivables. The old partners further agree to bring their capital balances into agreement with their interest in the earnings. 4. How much cash must be invested by Captain Boomerang to acquire one-third interest in…
i.2
The partners of Triple A Partnership are Adah, Ana and Ara. During the current year, their average capital balances are as follows: Adah – P 180,000; Ana – P160,000; Ara – P 150,000. The articles of partnership provided the following terms: 1. Annual interest of 8% on their average capital balances. 2. Salary allowances as follows: Adah – P 50,000 and Ana – P 80,000. 3. Ana shall receive bonus of 15% of income in excess of P40,000 after partner’s interest and salary allowances. 4. Residual profits shall be divided in the ratio of 2:2:6 to Adah, Ana and Ara. What amount will Ana receive if the net income earned is P 470,000?
Kelly, Kayla and Kathy are partners in Karisma Trading sharing profits or losses in the proportion of 3:1:2respectively. The partnership agreement states the following:1. Kelly and Kathy are entitled to a monthly salary of RM2,500 and RM2,000 respectively.2. Interest in the capital is at 5% per annum.3. Interest in drawings is at 7% per annum.The following balances were obtained from the partnership books for the financial year ended 31 December 2015. Please prepare the following: b) Appropriation Account for the year ended 31 December 2015.
Keri & Nick Consulting’s partners’ equity accounts reflected the following balances on August 31, 2020: Keri Lee, Capital $ 68,000 Nick Kalpakian, Capital 205,000 Lee and Kalpakian share profit/losses in a 2:3 ratio, respectively. On September 1, 2020, Liam Court is admitted to the partnership with a cash investment of $117,000.Required:Prepare the journal entry to record the admission of Liam under each of the following unrelated assumptions, where he is given:a. A 30% interest in equityb. A 20% interest in equityc. A 50% interest in equity
On December 31, 2014, LBM Partnership’s accounts show the following. Answer the following questions under the different scenarios. Partner Drawings Capital Lisa $23,000 $48,000 Bart 14,000 30,000 Maggie 10,000 25,000 Scenario1: Net income for the year is $30,000. Income is shared 60% to Lisa, 30% to Bart, and 10% to Maggie. How much is each partner’s share of the income? Lisa Bart Maggie Scenario 2: Net income was $60,000 for the year. Lisa and Bart are each given a $15,000 salary allowance. The remainder is shared equally. Prepare a schedule showing the division of net income. Lisa Bart Maggie Total Salary allowance Remaining income Total division of net income Scenario 3: Net income was $24,000 for the year. Each partner is given a 10% interest on beginning capital balances. Lisa is given a $10,000 salary allowance and $5,000 is…
The statement of financial position of ABC Partnership on May 31,2022 is given below: Cash P25,000 Accounts Payable P70,000 Receivable 25,000 Loan Payable to Allan 30,000 Inventories 180,000 Allan, Capital 75,000 Plant& Equipment 20,000 Bobby, Capital 75,000 Carlo, Capital 100,000 P350,000 P350,000 Dan joined the partnership on June 1, 2022 by investing P75,000 for a 1/5 interest in an agreed capitalization of P325,000. What is the amount of Carlo, capital after the admission of Dan?
Smith, Wong, and Krishnan form a partnership. Smith contributes RM180,000, Wong contributes RM150,000, and Krishnan contributes RM270,000. Their partnership agreement calls for a 5% interest allowance on the partner's capital balances with the remaining income or loss to be allocated equally. If the partnership reports income of RM174,000 for its first year, what amount of income is credited to Wong's capital account? A RM55,500. B RM57,000. C RM58,000. D RM61,500.
Partners A, B and C started their partnership firm M/s. ABC LLC in Muscat with capitals of OMR80,000; OMR 48,000 and OMR 40,000 respectively on 1.1.2019. They prepared Partnership Deedfor the partnership and it contains the various clauses related to – the firm has to pay the partners@ 5.5 % p.a., for their capital contributed to the business and the partners have to pay @ 2.5% fortheir drawings taken from the business during the financial year. Further the firm has to pay salaryto A @ OMR 600 per month, @ 10% commission to B and C and bonus to A and C @ OMR 500 each.Finally the firm’s Profit and Losses for the partners to be shared at the end the financial year Up toOMR 9,000 in the ratio of 4:3:2 and Above OMR 9,000 equally. The net profit earned by the firmduring the year ended 31st December 2019 amounted to OMR 55,500. The partners were drawnthe money from the firm during the financial year is - A OMR 4,800: B OMR 3,200 and C OMR 2,000.Prepare both Profit and Loss Appropriation…