Homework Help is Here – Start Your Trial Now!
Business
Accounting
ontributed P24,0 uted P48,000 to f ship, and they ag

ontributed P24,0 uted P48,000 to f ship, and they ag

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
See similar textbooks
icon
Related questions
Question

What is the correct answer to the question?

16. PP contributed P24,000 and CC contributed P48,000 to form a partnership, and they agreed to share profits in the ratio of their original capital contributions. During the first year of operations, they made a profit of P16,290; PP withdrew P5,050 and CC P8,000. At the start of the following year, they agreed to admit GG into the partnership. He was to receive a one- fourth interest in the capital and profits upon payment of P30,000 to PP and CC, whose capital accounts were to be reduced by transfers to GG's capital account of amounts sufficient to bring them back to their original capital ratio. How should the P30,000 paid by GG be divided between PP and CC? * а. PP, Р9,825; СС, Р20,175 b. PP, P15,000; CC, P15,000 с. РP, Р10,000;B СС, Р20,000 O d. PP, P9,300; CC, P20,700
Transcribed Image Text:16. PP contributed P24,000 and CC contributed P48,000 to form a partnership, and they agreed to share profits in the ratio of their original capital contributions. During the first year of operations, they made a profit of P16,290; PP withdrew P5,050 and CC P8,000. At the start of the following year, they agreed to admit GG into the partnership. He was to receive a one- fourth interest in the capital and profits upon payment of P30,000 to PP and CC, whose capital accounts were to be reduced by transfers to GG's capital account of amounts sufficient to bring them back to their original capital ratio. How should the P30,000 paid by GG be divided between PP and CC? * а. PP, Р9,825; СС, Р20,175 b. PP, P15,000; CC, P15,000 с. РP, Р10,000;B СС, Р20,000 O d. PP, P9,300; CC, P20,700
Expert Solution
steps

Step by step

Solved in 2 steps

SEE SOLUTIONCheck out a sample Q&A here
Blurred answer
Knowledge Booster
Financial Planning
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.
Recommended textbooks for you
FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
Accounting
ISBN:
9781259964947
Author:
Libby
Publisher:
MCG
Accounting
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education
SEE MORE TEXTBOOKS