Max, Alfred and Waters shared profits and losses 20%, 40%, and 40% respectively and their partnership capital balance is P10,000, P30,000 and P50,000 respectively. Max has decided to withdraw from the partnership. An appraisal of the business and its property estimates the fair value to be P 200,000. Land with a book value of P30,000 has a fair value of P45,000. Max has agreed to receive P20,000 in exchange for her partnership interest. What amount should land be recorded on the partnership books? A. 20,000 B. 30,000 C. 45,000 D. 50,000
Max, Alfred and Waters shared profits and losses 20%, 40%, and 40% respectively and their partnership capital balance is P10,000, P30,000 and P50,000 respectively. Max has decided to withdraw from the partnership. An appraisal of the business and its property estimates the fair value to be P 200,000. Land with a book value of P30,000 has a fair value of P45,000. Max has agreed to receive P20,000 in exchange for her partnership interest. What amount should land be recorded on the partnership books? A. 20,000 B. 30,000 C. 45,000 D. 50,000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Max, Alfred and Waters shared profits and losses 20%, 40%, and 40% respectively and their partnership capital balance is P10,000, P30,000 and P50,000 respectively. Max has decided to withdraw from the partnership. An appraisal of the business and its property estimates the fair value to be P 200,000. Land with a book value of P30,000 has a fair value of P45,000. Max has agreed to receive P20,000 in exchange for her partnership interest. What amount should land be recorded on the partnership books?
A. 20,000
B. 30,000
C. 45,000
D. 50,000
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