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Partners D, E, F, and G share profits 40%, 30%, 15%, and 15%, respectively. Their partnership agreement provides that in the event of the death of a partner, the firm shall continue until the end of the fiscal period. Profits shall be considered to have been earned proportionately during this period, and the deceased partner's capital shall be adjusted by the proper share of the profit or loss until the date of death. From that date until the date of settlement with the estate, there shall be added interest of 6% computed on the adjusted capital. The remaining partners shall continue to share profits in the old ratio. Payment to the estate shall be made within one year from the date of the partner's death. Partner G died on November 16. On December 31, the end of the six-month period, account balances on the partnership books before the income summary account is closed are as follows:

Partners D, E, F, and G share profits 40%, 30%, 15%, and 15%, respectively. Their partnership agreement provides that in the event of the death of a partner, the firm shall continue until the end of the fiscal period. Profits shall be considered to have been earned proportionately during this period, and the deceased partner's capital shall be adjusted by the proper share of the profit or loss until the date of death. From that date until the date of settlement with the estate, there shall be added interest of 6% computed on the adjusted capital. The remaining partners shall continue to share profits in the old ratio. Payment to the estate shall be made within one year from the date of the partner's death. Partner G died on November 16. On December 31, the end of the six-month period, account balances on the partnership books before the income summary account is closed are as follows:

FINANCIAL ACCOUNTING
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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Partners D, E, F, and G share profits 40%, 30%, 15%, and 15%, respectively. Their partnership agreement provides that in the event of the death of a partner, the firm shall continue until the end of the fiscal period. Profits shall be considered to have been earned proportionately during this period, and the deceased partner's capital shall be adjusted by the proper share of the profit or loss until the date of death. From that date until the date of settlement with the estate, there shall be added interest of 6% computed on the adjusted capital. The remaining partners shall continue to share profits in the old ratio. Payment to the estate shall be made within one year from the date of the partner's death. Partner G died on November 16. On December 31, the end of the six-month period, account balances on the partnership books before the income summary account is closed are as follows: P 15,000 Notes Payable Accounts Receivable 140,000 Accounts Payable P 30,000 141,000 84,000 75,000 Cash 190,000 D, Capital 90,000 E, Capital 33,000 F, Capital G, Capital Inventories Machinery, net Furniture, net 48,000 45,000 Income Summary P 468,000 45,000 P 468,000 Total The income summary account is for the period July 1 - December 31 and is closed on December. On this date, F decides to retire. Dand E agree to pay the balance in F's capital account after distributions of profit, less 20%, and issue a partnership 60-day, 6% note to F in settlement. What amount of note payable must be issued to F?
Transcribed Image Text:Partners D, E, F, and G share profits 40%, 30%, 15%, and 15%, respectively. Their partnership agreement provides that in the event of the death of a partner, the firm shall continue until the end of the fiscal period. Profits shall be considered to have been earned proportionately during this period, and the deceased partner's capital shall be adjusted by the proper share of the profit or loss until the date of death. From that date until the date of settlement with the estate, there shall be added interest of 6% computed on the adjusted capital. The remaining partners shall continue to share profits in the old ratio. Payment to the estate shall be made within one year from the date of the partner's death. Partner G died on November 16. On December 31, the end of the six-month period, account balances on the partnership books before the income summary account is closed are as follows: P 15,000 Notes Payable Accounts Receivable 140,000 Accounts Payable P 30,000 141,000 84,000 75,000 Cash 190,000 D, Capital 90,000 E, Capital 33,000 F, Capital G, Capital Inventories Machinery, net Furniture, net 48,000 45,000 Income Summary P 468,000 45,000 P 468,000 Total The income summary account is for the period July 1 - December 31 and is closed on December. On this date, F decides to retire. Dand E agree to pay the balance in F's capital account after distributions of profit, less 20%, and issue a partnership 60-day, 6% note to F in settlement. What amount of note payable must be issued to F?
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