The partnership of Maring and Habagat began business on January 1, 2013. The following assets were contributed by each partner (the non-cash assets are stated at their fair values onJanuary 1, 2013):CashInventoriesMaring30,00050,000Habagat20,000Land200,000EquipmentThe land was subject to a P65,000 mortgage, which the partnership assumed on January 1, 2013. The equipment was subject to an installment note payable that had an unpaid principalamount of P35,000 on January 1, 2013. The partnership also assumed this note payable. According to the partnership. agreement, each partner was to have a 50% capital interest onJanuary 1, 2013, with total partnership capital being P300,000. Maring and Habagat agreed to share partnership income and losses in the following manner:100,000Maring4%Habagat4%Interest on beginning capitalSalariesRemainderDuring 2013, the following events occurred:Inventory was acquired at a cost of P30,000. At December 31, 2013, the partnership owed P6,000 to its suppliers. The partnership inventory at December 31, 2013 was P20,000.Principal of P10,000 was paid on the mortgage. Interest expense incurred on the mortgage was P4,000, all of which was paid by December 31, 2013.Principal of P7,500 was paid on the installment note. Interest expense incurred on the installment note was P2,500, all of which was paid by December 31, 2013.Sales on account amounted to P115,000. At December 31, 2013, customers owed the partnership P10,000.Selling and general expenses, excluding depreciation, amounted to P21,000. At December 31, 2013, the partnership owed P3,000 of unrecorded accrued expenses. Depreciationexpense was P5,000.Each partner withdrew P225 each week in anticipation of partnership profits.The partners allocated the net income for 2013 and closed the accounts.Additional information:On January 1, 2014, the partnership decided to admit Nando to the partnership. On that date, Nando invested P100,900 of cash into the partnership for a 20% capital interest.1. The share of Habagat on the net income of 2013 must be:2. The capital balance of Maring at the end of 2013:3. The capital balance of Habagat after Nando's admission must be:15,00060%PP10,00040%

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On January 1, 2014, the partnership decided to admit Nando to the partnership. On that date, Nando invested P100,900 of cash into the partnership for a 20% capital 1. The share of Habagat on the net income of 2013 must be: 2. The capital balance of Maring at the end of 2013: 3. The capital balance of Habagat after Nando's admission must be:

On January 1, 2014, the partnership decided to admit Nando to the partnership. On that date, Nando invested P100,900 of cash into the partnership for a 20% capital 1. The share of Habagat on the net income of 2013 must be: 2. The capital balance of Maring at the end of 2013: 3. The capital balance of Habagat after Nando's admission must be:

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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