On March 31, 2019, Emng, Bobby, and Ramil formed the POGI Partnership to operate a CPA review center. The following is a list of their contributions at that date: --------------------------Emong---------------- Bobby -------------Ramil---------------- Book Value Fair Value Book Value Fair Value Book Value Fair Value Cash 132,000 132,000 100,000 100,000 120,000 120,000 Inventory 80,000 75,000 Land 150,000 188,000 Equipment - net 90,000 90,000 Totals 282,000 320,000 180,000 175,000 210,000 210,000 Bobby has an accounts payable of P50,000 on the inventory and Ramil has a mortgage payable of P60,000 on the equipment. The partners have agreed to assume only the mortgage payable but not the accounts payable. They further agreed for the capital ratio to be 50%, 20%, and 30% to Emong, Bobby, and Ramil, respectively.: The partnership starts operation on April 1, 2019 and on December 31, 2019 reported a net income of P305,400. The following is the profit and loss agreement among the partners 10% interest to each partner's beginning capital Salaries of P30,000 per quarter will be given to Emong and Ramil Bonus of 10% of net income after interest, salaries, and bonus will be given to Emong. Residual profit/(loss) will be divided equally. a). How much is the net asset contribution of Ramil? Choices: a) 210,000 b) 150,000 c) 175,000 d) 125,000 b). What is the beginning capital of Partner Bobby? Choices: a) 352,500 b) 211,500 c) 129,000 d) 141,000 c). Share of net income of Partner Emong on December 31, 2019? Choices: a) 149,210 b) 261,715 c) 148,035 d) 144,531 d). The capital balance of Partner Ramil on December 31, 2019 Choices: a) 344,495 b) 485,983 c) 343,120 d) 321,353

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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On March 31, 2019, Emng, Bobby, and Ramil formed the POGI Partnership to operate a CPA review center. The following is a list of their contributions at that date:

--------------------------Emong---------------- Bobby -------------Ramil----------------

	Book Value	Fair Value	Book Value	Fair Value	Book Value	Fair Value
Cash	132,000	132,000	100,000	100,000	120,000	120,000
Inventory			80,000	75,000
Land	150,000	188,000
Equipment - net					90,000	90,000
Totals	282,000	320,000	180,000	175,000	210,000	210,000

Bobby has an accounts payable of P50,000 on the inventory and Ramil has a mortgage payable of P60,000 on the equipment. The partners have agreed to assume only the mortgage payable but not the accounts payable. They further agreed for the capital ratio to be 50%, 20%, and 30% to Emong, Bobby, and Ramil, respectively.:

The partnership starts operation on April 1, 2019 and on December 31, 2019 reported a net income of P305,400.

The following is the profit and loss agreement among the partners

10% interest to each partner's beginning capital
Salaries of P30,000 per quarter will be given to Emong and Ramil
Bonus of 10% of net income after interest, salaries, and bonus will be given to Emong.
Residual profit/(loss) will be divided equally.

a). How much is the net asset contribution of Ramil?

Choices: a) 210,000 b) 150,000 c) 175,000 d) 125,000

b). What is the beginning capital of Partner Bobby?

Choices: a) 352,500 b) 211,500 c) 129,000 d) 141,000

c). Share of net income of Partner Emong on December 31, 2019?

Choices: a) 149,210 b) 261,715 c) 148,035 d) 144,531

d). The capital balance of Partner Ramil on December 31, 2019

Choices: a) 344,495 b) 485,983 c) 343,120 d) 321,353

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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