Sole proprietorship converted to partnership. Revaluation of assets and liabilities required.Dominic, the proprietor of Suds and Bubbles Laundry Shop invites Augustine to be a partner in his business. Accounts in the ledger of Dominic on August 1, 2023 justbefore the admission of Augustine show the following:Account TitlesCashAccounts ReceivablesAllowance for Bad Debts.Laundry SuppliesFurniture and EquipmentAccumulated Depreciation - Furniture andEquipmentAccounts payableDominic, CapitalTotalDebitP215.000120,00087,500750,000CreditP6,000168,75092.500905.250P 1.172.500 P1,172,500It was agreed that for the purpose of establishing Dominic's interest, the following revaluations shall be made:1. The allowance for bad debts shall be increased by 5% of outstanding accounts receivable.2. The Laundry Supplies inventory is to be valued at P 80,000.3. And a professional appraiser estimated that the furniture and equipment is worth P550,000.4. Electricity consumption for the month of July 2023 amounting to P4,500 is still unpaid.Augustine is to invest cash which will give him a 40% capital ownership in the newly formed partnershipHow much is the adjusted capital balance of Dominic upon formation of the partnership?

Revaluation account is required to be made first then resulting output to be transferred to capital…

It was agreed that for the purpose of establishing Dominic's interest, the following revaluations shall be made 1. The allowance for bad debts shall be increased by 5% of outstanding accounts receivable. 2. The Laundry Supplies inventory is to be valued at P 80.000. 3. And a professional appraiser estimated that the furniture and equipment is worth P550,000. 4. Electricity consumption for the month of July 2023 amounting to P4,500 is still unpaid Augustine is to invest cash which will give him a 40% capital ownership in the newly formed partnership How much is the adjusted capital balance of Dominic upon formation of the partnership?

It was agreed that for the purpose of establishing Dominic's interest, the following revaluations shall be made 1. The allowance for bad debts shall be increased by 5% of outstanding accounts receivable. 2. The Laundry Supplies inventory is to be valued at P 80.000. 3. And a professional appraiser estimated that the furniture and equipment is worth P550,000. 4. Electricity consumption for the month of July 2023 amounting to P4,500 is still unpaid Augustine is to invest cash which will give him a 40% capital ownership in the newly formed partnership How much is the adjusted capital balance of Dominic upon formation of the partnership?

Century 21 Accounting Multicolumn Journal

11th Edition

ISBN:9781337679503

Author:Gilbertson

Publisher:Gilbertson

Chapter23: Accounting For Partnerships

Section: Chapter Questions

Problem 2.1AP

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