Red, White and Blue are partners in a business, and in its profits at the respective ratio of 5:3:2. On January 3, 2020, they admit Green, who is to invest in the firm sufficient cash to have a orne-third interest in the partnership capital and profits. The following trial balance is taken from the original partnership's records: Red, White and Blue Trial Balance Debit P 100,000 75,000 225,000 Credit Cash Marketable securities Accounts receivable Accounts payable Red, Capital White, Capital Blue, Capital P 80,000 175,000 100,000 45,000 Total P 400,000 P 400,000 The securities have a market value of P50,000, and an allowance of P25,000 was expected to cover collection losses on the receivables. No other adjustments of the net assets are considered necessary: however, the three partners among themselves must bring the balance in their capital accounts into agreement with their interest in profits. What amount must be invested by Green?
Red, White and Blue are partners in a business, and in its profits at the respective ratio of 5:3:2. On January 3, 2020, they admit Green, who is to invest in the firm sufficient cash to have a orne-third interest in the partnership capital and profits. The following trial balance is taken from the original partnership's records: Red, White and Blue Trial Balance Debit P 100,000 75,000 225,000 Credit Cash Marketable securities Accounts receivable Accounts payable Red, Capital White, Capital Blue, Capital P 80,000 175,000 100,000 45,000 Total P 400,000 P 400,000 The securities have a market value of P50,000, and an allowance of P25,000 was expected to cover collection losses on the receivables. No other adjustments of the net assets are considered necessary: however, the three partners among themselves must bring the balance in their capital accounts into agreement with their interest in profits. What amount must be invested by Green?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
100%
Transcribed Image Text:Red, White and Blue are partners ina business, and in its profits at the respective ratio of 5:3:2. On January 3, 2020,
they admit Green, who is to invest in the firm sufficient cash to have a one-third interest in the partnership capital
and profits. The following trial balance is taken from the original partnership's records:
Red, White and Blue
Trial Balance
Debit
Credit
P 100,000
Cash
Marketable securities
Accounts receivable
75,000
225,000
P 80,000
Accounts payable
Red, Capital
White, Capital
Blue, Capital
175,000
100,000
45,000
Total
P 400,000
P 400,000
The securities have a market value of P50,000, and an allowance of P25,000 was expected to cover collection
losses on the receivables. No other adjustments of the net assets are considered necessary: however, the three
partners among themselves must bring the balance in their capital accounts into agreement with their interest in
profits. What amount must be invested by Green?
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education