The conditions agreed by the partners for purposes of determining their interests in the partnership are presentedbelow:10% of accounts receivable is to be set up as uncollectible in each book.b. Merchandise inventory of Henry is to be increased by P 1, 000.The furniture and fixtures of Gerry and Henry are to be depreciated by P 600 and P 900 respectively.a.c.Required:Prepare the necessary journal entries to record the formation of the partnership.Problem #4Froilan Labausa contributed land, inventory and P 280,000 cash to a partnership. The land has a book value of P 650,000 and a market value of P 1,350,000. The inventory has a book value of P 600,000 and a market value of P 510,000.The partnership also assumed a P 350,000 note payable owed by Labausa that was used to purchase the land. RosalieBalhag agreed to put up cash equivalent to Labausa's net investment.REQUIRED: prepare the journal entry to record Labausa's and Balahag's investment in the partnership.Problem #5Sabio, as her original investment in the firm of Sabio and Mariano, contributed equipment that had been recorded inthe books of her own business as costing P 900, 000, with accumulated depreciation of P 620, 000. The partners agreedon a valuation of P 400, 000. they also agreed to accept Sabio's accounts receivable of P 360, 000, realizable to theextent of 85%.REQUIRED: Prepare the journal entry to record Sabio's investment in the partnership.Problem #6Gogola and Paglinawan have just formed a partnership. Gogola contributed cash of P 1,260,000 and computerequipment that cost P 540,000. The fair value of the computer is P 360,000. Gogola has notes payable on the computerof P 120,000 to be assumed by the partnership. Gogola is to have a 60% capital interest in the partnership. Paglinawancontributed only P 900,000. The partners agreed to share profits and loss equally.Gogola should make an additional investment or (withdrawal) of?

Hi student Since there are multiple questions, we will answer only first question.

Problem #4 Froilan Labausa contributed land, inventory and P 280,000 cash to a partnership. The land has a book value of P 650, 000 and a market value of P 1,350,000. The inventory has a book value of P 600,000 and a market value of P 510,000. The partnership also assumed a P 350,000 note payable owed by Labausa that was used to purchase the land. Rosalie Balhag agreed to put up cash equivalent to Labausa's net investment. REQUIRED: prepare the journal entry to record Labausa's and Balahag's investment in the partnership.

Problem #4 Froilan Labausa contributed land, inventory and P 280,000 cash to a partnership. The land has a book value of P 650, 000 and a market value of P 1,350,000. The inventory has a book value of P 600,000 and a market value of P 510,000. The partnership also assumed a P 350,000 note payable owed by Labausa that was used to purchase the land. Rosalie Balhag agreed to put up cash equivalent to Labausa's net investment. REQUIRED: prepare the journal entry to record Labausa's and Balahag's investment in the partnership.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

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Concept explainers

Partnership Accounting

A partnership is a kind of arrangement between two or more people whereby they agree to manage the business operations and share its profits and losses in an agreed ratio between them. The agreement that is drafted and signed by the partners of the firm is termed as partnership deed and contains various important clauses agreed between the partners such as profit/loss sharing, interest on capital, remuneration allocation of each partner, drawings, admission of a new partner, etc.

Partner Admission and Withdrawal

A partnership is a kind of arrangement between two or more people whereby they agree to manage the business operations and share its profits and losses in an agreed ratio between them. The agreement that is 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, drawings of a partner, etc.

Question

100%

The conditions agreed by the partners for purposes of determining their interests in the partnership are presented
below:
10% of accounts receivable is to be set up as uncollectible in each book.
b. Merchandise inventory of Henry is to be increased by P 1, 000.
The furniture and fixtures of Gerry and Henry are to be depreciated by P 600 and P 900 respectively.
a.
c.
Required:
Prepare the necessary journal entries to record the formation of the partnership.
Problem #4
Froilan Labausa contributed land, inventory and P 280,000 cash to a partnership. The land has a book value of P 650,
000 and a market value of P 1,350,000. The inventory has a book value of P 600,000 and a market value of P 510,000.
The partnership also assumed a P 350,000 note payable owed by Labausa that was used to purchase the land. Rosalie
Balhag agreed to put up cash equivalent to Labausa's net investment.
REQUIRED: prepare the journal entry to record Labausa's and Balahag's investment in the partnership.
Problem #5
Sabio, as her original investment in the firm of Sabio and Mariano, contributed equipment that had been recorded in
the books of her own business as costing P 900, 000, with accumulated depreciation of P 620, 000. The partners agreed
on a valuation of P 400, 000. they also agreed to accept Sabio's accounts receivable of P 360, 000, realizable to the
extent of 85%.
REQUIRED: Prepare the journal entry to record Sabio's investment in the partnership.
Problem #6
Gogola and Paglinawan have just formed a partnership. Gogola contributed cash of P 1,260,000 and computer
equipment that cost P 540,000. The fair value of the computer is P 360,000. Gogola has notes payable on the computer
of P 120,000 to be assumed by the partnership. Gogola is to have a 60% capital interest in the partnership. Paglinawan
contributed only P 900,000. The partners agreed to share profits and loss equally.
Gogola should make an additional investment or (withdrawal) of?

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