Use the following information for the next four questions: How much is the total loss on the sale of partnership assets?A. 432,000B. 720,000C. 0D. 868,000 How much did B receive in the settlement of his capital balance?A. 280,000B. 0C. 218,000D. 312,000 How much were the total liabilities of the partnership?A. 320,000B. 50,000C. 200,000D. 180,000 How much was the balance of cash before the sale of non-cash assets?A. 80,000B. 40,000C. 60,000D. 0 On January 1, 20x1, A and B, who share profits and losses on a 60:40 ratio, decided to liquidate theirpartnership. As of this date, their capital balances were P1,200,000 and P600,000, respectively. Beforeliquidation, the partnership had total assets of P2,000,000. Net proceeds received from the sale of non-cash assets amounted to P1,200,000. A received P768,000 in the settlement of the partners' capitalbalances.

Capital Balance of A P12,00,000 Amount received by A P7,68,000 Share of loss of A (P1200000 -…

Answered: On January 1, 20xl, A and B, who share…

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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Use the following information for the next four questions:

How much is the total loss on the sale of partnership assets?

A. 432,000

B. 720,000

C. 0

D. 868,000

How much did B receive in the settlement of his capital balance?

A. 280,000

B. 0

C. 218,000

D. 312,000

How much were the total liabilities of the partnership?

A. 320,000

B. 50,000

C. 200,000

D. 180,000

How much was the balance of cash before the sale of non-cash assets?

A. 80,000

B. 40,000

C. 60,000

D. 0

On January 1, 20x1, A and B, who share profits and losses on a 60:40 ratio, decided to liquidate their
partnership. As of this date, their capital balances were P1,200,000 and P600,000, respectively. Before
liquidation, the partnership had total assets of P2,000,000. Net proceeds received from the sale of non-
cash assets amounted to P1,200,000. A received P768,000 in the settlement of the partners' capital
balances.

Definition Definition Arrangement between two or more people whereby they agree to manage business operations and share its profits and losses in an agreed ratio. The agreement 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, and drawings of a partner.

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