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C invests P71,250 cash for a 20% interest in the net assets and profits of the partnership. C's capital account is credited for the fair value of the 20% interest he acquired. How much is the capital balance of B after the admission of C? a. 102,400 b. 94,000 c. 86,400 d. 120,400

C invests P71,250 cash for a 20% interest in the net assets and profits of the partnership. C's capital account is credited for the fair value of the 20% interest he acquired. How much is the capital balance of B after the admission of C? a. 102,400 b. 94,000 c. 86,400 d. 120,400

FINANCIAL ACCOUNTING
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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2. Under Millan book. This is not a part of our exam but is included in the reference book and I want to review its answer.

A&B Partnership admits C as a new partner. The statement of financial position before the admission of C is shown below: Cash 26,000 Accounts payable 62,000 Accounts receivable 120,000 A, Capital (60%, interest in PA) 170,000 180,000 B, Capital (40% interest in PL) 94,000 326,000 Inventory Total assets 326,000 Total liabilities and equity 2. Cinvests P71,250 cash for a 20% interest in the net assets and profits of the partnership. C's capital account is credited for the fair value of the 20% interest he acquired. How much is the capital balance of B after the admission of C? a. 102,400 b. 94,000 c. 86,400 d. 120,400
Transcribed Image Text:A&B Partnership admits C as a new partner. The statement of financial position before the admission of C is shown below: Cash 26,000 Accounts payable 62,000 Accounts receivable 120,000 A, Capital (60%, interest in PA) 170,000 180,000 B, Capital (40% interest in PL) 94,000 326,000 Inventory Total assets 326,000 Total liabilities and equity 2. Cinvests P71,250 cash for a 20% interest in the net assets and profits of the partnership. C's capital account is credited for the fair value of the 20% interest he acquired. How much is the capital balance of B after the admission of C? a. 102,400 b. 94,000 c. 86,400 d. 120,400
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