Adam, Eve and Abel are partners in Suave Swimsuits. Profits and losses are shared in the ratio of 5:3:2. On July 1, 2022, when their capital balances stood at P50,000, P25,000 and P30,000 respectively, they agree to admit Cain to the partnership. Answer the questions that follow assuming, Cain invests P45,000 cash in the partnership for a 30% interest. What is the capital balance of Abel after formation of the partnership? * Your answer What is the capital balance of Cain after formation of the partnership? * Your answer What is the capital balance of Adam after formation of the partnership? * Your answer What is the capital balance of Eve after formation of the partnership? *

Adam, Eve and Abel are partners in Suave Swimsuits. Profits and losses are shared in the ratio of 5:3:2. On July 1, 2022, when their capital balances stood at P50,000, P25,000 and P30,000 respectively, they agree to admit Cain to the partnership. Answer the questions that follow assuming, Cain invests P45,000 cash in the partnership for a 30% interest. What is the capital balance of Abel after formation of the partnership? * Your answer What is the capital balance of Cain after formation of the partnership? * Your answer What is the capital balance of Adam after formation of the partnership? * Your answer What is the capital balance of Eve after formation of the partnership? *

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

Lay and Zayn sell electronic equipment and supplies through their partnership. They wish to expand their computer lines and decide to admit Lulu to the partnership. Lay capital is P100,000 while Zayn capital is P80,000 and they share income in a ratio of 3:2. Lulu invests P40,000 for a one fifth interest in the total capital of P220,000 What is the capital of partner Zayn after admission of the new partner?
On September 2, 2020, Nino, Olan, and Pete formed a partnership investing cash of P945,000,P850,000, and P264,600. The partners share profits and losses in the ratio of 3:2:2 and on October 31,2020the firm has cash of P63,000, other assets of P2,992,500, and liabilities of P1,612,800. On this date theydecided to go out of busines and sell all the assets for P1,890,000. Pete has personal assets of P94,500thatmay, if necessary, be used to meet partnership obligations. Loss from operations was P617,400. Howmuchshould be distributed to Olan upon liquidation of the partnership? a. P128,520b. P306,180c. P0d. P268,380
Faith, Hope, and Love are partners sharing profits and losses in the ratio 22 1 and have capital balances of P800,000, P800,000, and P400,000, respectively. Grace purchases half of Faith's interest by paying her directly for an amount that earned her a profit of P60,000. The entry to record the admission of Grace in the partnership includes a Select the correct response debit to Cash, P460,000 credit to Grace, Capital, P400,000 credit to Grace, Capital, P460,000 debit to Faith, Capital, P460,000
May and Jun are partners with profit and loss ratio of 40:60 and capital balances of $600,000 and $400,000 respectively. On June 09, 2022, Julie was admitted into the partnership by investment for a 20% of the total partnership capitalization. What is Jun's new Profit and Loss Ratio after the admission of Julie? Note: Express your answer either in percentage or decimal. example: 50% or 0.50
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…
On February 1, 2022, AA and BB formed a partnership and agreed to share profits in the ratio of 4:6, respectively. AA contributed a laptop which cost him P68,000 and was estimated to have a value of P50,000 on date of formation. BB contributed cash of P250,000. How much is the capital account of BB upon formation of the partnership?
Nagisa and Karma are partners in an electrical repair business. Their respective capital balances are P90,000 and P50,000, and they share profits and losses equally. Because the partners are confronted with personal financial problems, they decided to admit a new partner to the partnership. After an extensive interviewing process, they elect to admit Isogai into the partnership. Required: Prepare the journal entry to record the admission of Isogai into the partnership under each of the following conditions: 1. Isogai invests P40,000 for a one-fifth interest in partnership capital. Revaluation method was used and other assets are to be recognized (use “Other Assets”).
Jo, Joy, and Joyce have capital balances of P40,000; P25,000 and P5,000 respectively on December 31, 2019. The partners’ profit and loss ratio is 3:2:1 respectively. The partners decided to liquidate the partnership and sold all non-cash assets for P37,000. After settlement of all liabilities amounting to P12,000, they still have cash of P28,000 left for distribution. Assuming that any capital deficiency is uncollectible, the share of Joy in the distribution of cash should be?
The capital account for the partnership A and B at October 31, 2011 are as follows: A, capital P80,000 and B, capital P40,000. The partners share profits and losses in the ratio of 3:2 respectively. The partnership is in desperate need of cash, and the partners agree to admit C as a partner with one-third interest in the capital and profits and losses upon his investment of P30,000. Immediately after C’s admission what should be the capital balances of A, B and C, respectively assuming bonus method is used.
Jerry and Sherry own and operate a partnership. Jerry’s capital balance is $50,000 and Sherry’s is $55,000. Jerry and Sherry decided to admit a new partner, Allison, to their partnership. By the terms of their partnership agreement, Jerry and Sherry share income/loss equally. Allison intends to contribute $40,000 cash to receive a twenty-five percent interest in the partnership Required: a. Revalue the partnership assets b. Determine the total equity of the partnership after the new partner is admitted c. Determine the new partner share of the total equity d. Determine the bonus resulting from Allison’s equity of her contribution e. Make journal entries to record Allison’s admission to the partnership. Please solve sub-part e. Show Your Work:
Daphne, Buddy, and Divine have equities in a partnership of P600,000, P900,000, and P500,000, respectively, and share profits and losses in a ratio of 2:1:2, respectively. The partners have agreed to admit Amy to the partnership If Amy invested P750,000 for a one-fifth interest how much is the capital balance of Daphne after the admission of Amy? Answer without peso signs but with commas.
After the tangible assets have been adjusted to current market prices, the capital accounts of Brad Paulson and Drew Webster have balances of $45,000 and $60,000, respectively. Austin Neel is to be admitted to the partnership, contributing $30,000 cash to the partnership, for which he is to receive an ownership equity of $35,000. All partners share equally in income.a. Journalize the entry to record the admission of Neel, who is to receive a bonus of $5,000.b. What are the capital balances of each partner after the admission of the new partner?c. Why are tangible assets adjusted to current market prices prior to admitting a new partner?