Jocelyn and Juvelyn decide to form a partnership. Jocelyn invests P25,000 cash and accounts receivable of P30,000 less allowance for doubtful accounts of P2,000. Juvelyn contributes P20,000 cash and equipment having a P6,000 book value. It is agreed that the allowance account should be P3,000 and the fair market value of the equipment is P10,000. How much should the capital of Jocelyn be credited?

Jocelyn and Juvelyn decide to form a partnership. Jocelyn invests P25,000 cash and accounts receivable of P30,000 less allowance for doubtful accounts of P2,000. Juvelyn contributes P20,000 cash and equipment having a P6,000 book value. It is agreed that the allowance account should be P3,000 and the fair market value of the equipment is P10,000. How much should the capital of Jocelyn be credited?

SWFT Corp Partner Estates Trusts

42nd Edition

ISBN:9780357161548

Author:Raabe

Publisher:Raabe

Chapter11: Partnerships: Distributions, Transfer Of Interests, And Terminations

Section: Chapter Questions

Problem 44P

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Concept explainers

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

Jocelyn and Juvelyn decide to form a partnership.
Jocelyn invests P25,000 cash and accounts receivable of
P30,000 less allowance for doubtful accounts of P2,000.
Juvelyn contributes P20,000 cash and equipment having
a P6,000 book value. It is agreed that the allowance
account should be P3,000 and the fair market value of
the equipment is P10,000. How much should the capital
of Jocelyn be credited?

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