ILLUSTRATION 12. A, B and C are partners in a firm sharing profits and losses in the ratio of 2:2: 1. They decided to dissolve and appoint B to realise the assets and distribute the proceeds for which he is to receive as his remuneration 5% of the amounts ultimately paid to A and C but in lieu of this he is to bear all expenses of realisation. Balance Sheet of the firm on the date of dissolution is as under : Liabilities $ Assets Creditors A's Capital B's Capital 4,229 1,317 3,960 2,970 Debtors Less : Provision 211 4,018 1,872 Stock Cash 290 1,710 357 Other Assets C- (Overdrawn) 8,247 8,247 B informs of the following realisations : Debtors $ 3,462 ; Stock $ 1,444 ; Goodwill $ 50; Other Assets $ 914. Creditors which were not recorded in books are now paid $100. Expenses of realisation amount to his insolvency. Close books of the firm. 310. C is able to contribute only $ 100 beyond which he expresses

ILLUSTRATION 12. A, B and C are partners in a firm sharing profits and losses in the ratio of 2:2: 1. They decided to dissolve and appoint B to realise the assets and distribute the proceeds for which he is to receive as his remuneration 5% of the amounts ultimately paid to A and C but in lieu of this he is to bear all expenses of realisation. Balance Sheet of the firm on the date of dissolution is as under : Liabilities $ Assets Creditors A's Capital B's Capital 4,229 1,317 3,960 2,970 Debtors Less : Provision 211 4,018 1,872 Stock Cash 290 1,710 357 Other Assets C- (Overdrawn) 8,247 8,247 B informs of the following realisations : Debtors $ 3,462 ; Stock $ 1,444 ; Goodwill $ 50; Other Assets $ 914. Creditors which were not recorded in books are now paid $100. Expenses of realisation amount to his insolvency. Close books of the firm. 310. C is able to contribute only $ 100 beyond which he expresses

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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The partnership of Kylie, Bamboo and Tank is being liquidated. The summarized balance sheet below depicts their financial position before liquidation: Cash Loans to Tank Other non-cash assets P 30,000 70,000 600,000 The other non-cash assets were sold at P400,000. 1. The excess cash distributed to Kylie is P40,000 A. True B. False Accounts payables P Kylie, loan Kylie, capital (40%) Bambo, capital (20%) Tank, capital (40%) 2. The excess cash distributed to Tank is P110,000 A. True B. False 3. The ending balance of non-cash assets after liquidation is P200,000 A. True B. False 280,000 30,000 90,000 150,000 150,000
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A and B are combining their separate businesses to form a partnership. Presented here are the Statements of Financial Position before any adjustments: Current Assets Non-current Assets Total Liabilities ● A 617,500 848,000 150,000 B 672,500 970,000 178,000 They agreed to set up P5,000 each as uncollectible accounts on their accounts receivable. They also found out that their Non-current assets (all depreciable assets) were under-depreciated by P80,000 each. The partners agreed to equalize their capital balance upon formation. Compute the total capital of the partnership.
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