Problem: Fiona and Gary are partners with balances of P300,000 and P200,000, respectively. They agree to accept Romy who will contribute cash of P250,000 to the firm.Required: Compute for the revised partner’s equity for the following independent cases.Romy will be given 1/3 interest in the firm. No Bonus or Asset revaluation should be recognized (Admission by Purchase).Romy will be given a 40% interest in the firm. Use Bonus Method (Admission by Investment).Romy will be given a 40% interest in the firm. Use Revaluation Method (Admission by Investment).Romy will be given 25% interest in the firm. Use Bonus Method (Admission by Investment).Romy will be given 25% interest in the firm. Use Revaluation Method (Admission by Investment). Problem:Fiona and Gary are partners with balances of P300,000 and P200,000, respectively. They agree toaccept Romy who will contribute cash of P250,000 to the firm.Required: Compute for the revised partner's equity for the following independent cases.a. Romy will be given 1/3 interest in the firm. No Bonus or Asset revaluation should be recognized(Admission by Purchase).b. Romy will be given a 40% interest in the firm. Use Bonus Method (Admission by Investment).c. Romy will be given a 40% interest in the firm. Use Revaluation Method (Admission by Investment).d. Romy will be given 25% interest in the firm. Use Bonus Method (Admission by Investment).e. Romy will be given 25% interest in the firm. Use Revaluation Method (Admission by Investment).

The bonus method is used to grant a new partner additional capital in a partnership when the person…

Answered: Problem: Fiona and Gary…

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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Problem:

Fiona and Gary are partners with balances of P300,000 and P200,000, respectively. They agree to accept Romy who will contribute cash of P250,000 to the firm.

Required: Compute for the revised partner’s equity for the following independent cases.

Romy will be given 1/3 interest in the firm. No Bonus or Asset revaluation should be recognized (Admission by Purchase).
Romy will be given a 40% interest in the firm. Use Bonus Method (Admission by Investment).
Romy will be given a 40% interest in the firm. Use Revaluation Method (Admission by Investment).
Romy will be given 25% interest in the firm. Use Bonus Method (Admission by Investment).
Romy will be given 25% interest in the firm. Use Revaluation Method (Admission by Investment).

Problem:
Fiona and Gary are partners with balances of P300,000 and P200,000, respectively. They agree to
accept Romy who will contribute cash of P250,000 to the firm.
Required: Compute for the revised partner's equity for the following independent cases.
a. Romy will be given 1/3 interest in the firm. No Bonus or Asset revaluation should be recognized
(Admission by Purchase).
b. Romy will be given a 40% interest in the firm. Use Bonus Method (Admission by Investment).
c. Romy will be given a 40% interest in the firm. Use Revaluation Method (Admission by Investment).
d. Romy will be given 25% interest in the firm. Use Bonus Method (Admission by Investment).
e. Romy will be given 25% interest in the firm. Use Revaluation Method (Admission by Investment).

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