Salary allowances.d. Interest on capital balances.16 A partner who contributes money or property as well as his work or industry to thecapital of the partnership is calledIndustrial partnera.b. Capitalist partnerc. Managing partnerd. Capitalist-industrial partner17. Closing entries of a partnership include entries toa, record distribution of cash to the partners.b. eliminate the capital accounts and record the distribution of assets to partnersto effect the partnership termination and liquidation.C. close income and expense accounts to the income summary account; and thenclose the profits or losses to the drawing accounts.d. close the profits or losses and dividends declared accounts to retained earnings.18. Arzadon, Ballada and Castro are partners. Their contributions are as follows:Arzadon, P600,000; Ballada, P400,000 and Castro, services. The partners did notagree on how to divide profits or losses. If there is a loss of P100,000, how shouldthe loss be shared by the partners?a. Arzadon, P60,000; Ballada, P40,000 and Castro, nothing.b. Arzadon, P35,000; Ballada, P25,000 and Castro, P40,000.c. Arzadon, P35,000; Ballada, P35,000 and Castro, P30,000.d. Arzadon, P30,000; Ballada, P20,000 and Castro, P50,000.19. A 1:3:2 ratio is the same asa. 10%:30%:20%.b. 1/10:3/10:2/10.c. 1/6:1/2:1/3.d. 20%:50%:30%.20. Periodic withdrawals by partners are best viewed asa. expense of doing business.b. taxable income to the partners.C. distribution of partnership assets to the partners.d. payment for partners' personal services to the partnership. a. P30,000 decreaseb. P40,000 increaseC. P50,000 increased. P90,000 increaseParducho receive if profits and losses are distributed based on the ratio of daverage capital balances?a. P360,000b. P387,500c. P440,000d. P453,20012. Which of the following is not a component of the formula used to distribute profit?a. After all other allocations, the remainder divided according to the profit and losssharing ratio.b. Salary allowances to the managing partners.Interest on the average capital investments.C.d. Interest on notes to partners.13. A partner has a capital balance of P400,000 for five months, P500,000 for fourmonths, and P600,000 for three months. The average capital balance isa. P483,333.b. P485,000.C. P491,680.d. P500,000.14. Arzadon, Ballada and Castro are partners. Their contributions are as follows:Arzadon, P600,000; Ballada, P400,000 and Castro, services. Partners Arzadon,Ballada and Castro agreed to divide profits or losses in the ratio of 35:25:40,respectively. How should a loss of P100,000 be shared by the partners?20a. Arzadon, P30,000; Ballada, P20,000 and Castro, P50,000.b. Arzadon, P35,000; Ballada, P25,000 and Castro, P40,000.C. Arzadon, P35,000; Ballada, P35,000 and Castro, P30,000.d. Arzadon, P60,000; Ballada, P40,000 and Castro, nothing.a. Equally.b. Specified ratio.

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Answered: C. P50,000 increase d. P90,000 increase…

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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Market Value Capital Structure Suppose the Schoof Company has this book value balance sheet: Current assets Fixed assets Total assets $30,000,000 70,000,000 $100,000,000 Current liabilities $20,000,000 Notes payable 10,000,000 Long-term debt 30,000,000 Common stock (1 million shares) Retained earnings 1,000,000 Total liabilities and equity 39,000,000 $100,000,000 The notes payable are to banks, and the interest rate on this debt is 8%, the same as the rate on new bank loans. These bank loans are not used for seasonal financing but instead are part of the company's permanent capital structure. The long-term debt consists of 30,000 bonds, each with a par value of $1,000, an annual coupon interest rate of 7%, and a 20-year maturity. The going rate of interest on new long-term debt, rd, is 12%, and this is the present yield to maturity on the bonds. The common stock sells at a price of $54 per share. Calculate the firm's market value capital structure. Do not round intermediate…
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. Return on assets enter the return on assets in percentages rounded to 2 decimal places % enter the return on assets in percentages rounded to 2 decimal places % 15 continue.. Headland Corporation was formed 5 years ago through a public subscription of common stock. Daniel Brown, who owns 15% of the common stock, was one of the organizers of Headland and is its current president. The company has been successful, but it currently is experiencing a shortage of funds. On June 10, 2021, Daniel Brown approached the Topeka National Bank, asking for a 24-month extension on two $35,320 notes, which are due on June 30, 2021, and September 30, 2021. Another note of $5,940 is due on March 31, 2022, but he expects no difficulty in paying this note on its due date. Brown explained that Headland’s cash flow problems are due primarily to the company’s desire to finance a $302,050 plant expansion over the next 2 fiscal years through internally generated funds.The commercial loan…
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Question 1 Builtrite had sales of $700,000 and COGS of $300,000. In addition, operating expenses were calculated at 25% of sales. Builtrite also received dividends of $40,000 and paid out common stock dividends of $25,000 to its stockholders. A long-term capital gain of $80,000 was realized during the year along with a capital loss of $60,000 What is Builtrite's taxable income? $280,000 $257,000 $232,000 O $217,000 Question 2 Builtrite had sales of $700,000 and C0GS of $300,000. In addition, operating expenses were calculated at 25% of sales. Builtrite also received dividends of $40,000 and paid out common stock dividends of $25,000 to its stockholders. A long-term capital gain of $80,000 was realized during the year along with a capital loss of $60,000 Based on their taxable income calculated in question 1 (used for calculating taxes), how much would Builtrite's true net profits before tax increase in their income statement shown to the stockholders? $0 $12,000 $28,000 O $40,000
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am. 77.
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SOLVE THE FOLLOWING PROBLEM OF ACCOUNTING 1. Mr. Alfredo Mendaz gives us a loan of $160,000.00, for six months, charging us 42% annually. Make the entry at the time of the loan, and at the time of payment. 2. An entity obtains a net distributable profit of $175,00.00. The shareholders' meeting decrees a dividend of $50.00 per share, for each of the 2,500 subscribed shares. 3. Suppose that, at the end of the year, a bill of exchange for $160,000.00 is owed in favor of our creditor Carlos Pérez, due five months ago, on which the company has to pay interest Moratoriums of 6% per month. 4. An entity receives cash equivalent to 35% from a customer on a merchandise order with a value of $200,000.00. make the entry at the time of the advance, and when full payment is made and the merchandise is delivered. 5. Calculate the expenses and taxes pending payment, for each of the following concepts. CONCEPT salaries rents payroll taxes IMSS, SAR E fees INFONAVIT Electric energy service telephone…

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C. P50,000 increase d. P90,000 increase 11. Parducho had a P500,000 capital bal for four months. Burgos had a P3 P500,000 balance for seven months. Parducho receive if profits and loss average capital balances? a. P360,000 b. P387,500 C. P440,000 d. P453,200