Celestine and Jewel are partners who share income in the ratio of 2:3. The partners agree to admit Austin as a partner upon investing P150,000 cash for a 1/5 interest in the firm. The assets of the firm are fairly valued except for a building that is overvalued by P150,000. The capital accounts of Celestine and Jewel show balances of P450,000 and P300,000.
Celestine and Jewel are partners who share income in the ratio of 2:3. The partners agree to admit Austin as a partner upon investing P150,000 cash for a 1/5 interest in the firm. The assets of the firm are fairly valued except for a building that is overvalued by P150,000. The capital accounts of Celestine and Jewel show balances of P450,000 and P300,000.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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7. Determine the capital to be credited to Austin.
Transcribed Image Text:Celestine and Jewel are partners who share income in the ratio of 2:3. The partners agree to admit
Austin as a partner upon investing P150,000 cash for a 1/5 interest in the firm. The assets of the firm
are fairly valued except for a building that is overvalued by P150,000. The capital accounts of Celestine
and Jewel show balances of P450,000 and P300,000.
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