Jo, Lee and Bee are partners who share profits and losses in the ratio of 35:25:40 to Jo, Lee and Bee respectively. The statement of Financial Position of the partnership on December 31, 2017 is as follows: ASSETS Cash P8,000 Noncash assets 110,000 LIABILITIES AND CAPITAL Liabilities P18,000 Loan from Lee 2,000 Jo, Capital 32,700 Lee, Capital 23,500 Bee, Capital 41,800 On January 1, 2018, the partners decided to liquidate. For the month of January, some assets were sold for a loss of P2,000. Liabilities of P15,000 were paid. Payment to Partners Jo, Lee and Bee from the initial sale of assets were P150, P2,250 and P4,600 respectively. Cash withheld for possible liquidation expenses and unrecognized liabilities amounted to P1,250. What was the book/carrying value of the noncash assets sold in January? A. 28,250 B. 26,250 C. 20,250 D. 18,250
Partnership Accounting
A partnership is a kind of arrangement between two or more people whereby they agree to manage the business operations and share its profits and losses in an agreed ratio between them. The agreement that is drafted and signed by the partners of the firm is termed as partnership deed and contains various important clauses agreed between the partners such as profit/loss sharing, interest on capital, remuneration allocation of each partner, drawings, admission of a new partner, etc.
Partner Admission and Withdrawal
A partnership is a kind of arrangement between two or more people whereby they agree to manage the business operations and share its profits and losses in an agreed ratio between them. The agreement that is drafted and signed by the partners of the firm is termed as a partnership deed and contains various important clauses agreed between the partners such as profit/loss sharing, interest on capital, remuneration allocation of each partner, drawings of a partner, etc.
Question 1: Jo, Lee and Bee are partners who share
ASSETS
Cash P8,000
Noncash assets 110,000
LIABILITIES AND CAPITAL
Liabilities P18,000
Loan from Lee 2,000
Jo, Capital 32,700
Lee, Capital 23,500
Bee, Capital 41,800
On January 1, 2018, the partners decided to liquidate. For the month of January, some assets were sold for a loss of P2,000. Liabilities of P15,000 were paid. Payment to Partners Jo, Lee and Bee from the initial sale of assets were P150, P2,250 and P4,600 respectively. Cash withheld for possible liquidation expenses and unrecognized liabilities amounted to P1,250.
What was the book/carrying value of the noncash assets sold in January?
A. 28,250
B. 26,250
C. 20,250
D. 18,250
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