If Arwind invested P 130,000 for a 25% interest in the firm and that the assets of the partnership are fairly valued, what would be the capital of Romeo after the admission of Arwind? If Arwind purchased 25% of the respective capital and profits and losses of Terence and Romeo for P 150,000, how much is the share of Terence in the asset adjustment?

If Arwind invested P 130,000 for a 25% interest in the firm and that the assets of the partnership are fairly valued, what would be the capital of Romeo after the admission of Arwind? If Arwind purchased 25% of the respective capital and profits and losses of Terence and Romeo for P 150,000, how much is the share of Terence in the asset adjustment?

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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Question

4-10 Terence and Romeo are partners who share profits and losses 60% and 40%, respectively.
Their capital accounts on July 1, 2017 were as follows: Terence - P 280,000; Romeo -
P240,000. On this date, they agree to admit Arwind as a new partner.
If Arwind invested P 130,000 for a 25% interest in the firm and that the assets of the
partnership are fairly valued, what would be the capital of Romeo after the
admission of Arwind?
If Arwind purchased 25% of the respective capital and profits and losses of Terence
and Romeo for P 150,000, how much is the share of Terence in the asset
adjustment?

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