The balance sheet for the partnership of Nina, Pinta, and Santa Maria at January 1, 2014 follows. The partners share profits and losses in theratio of 3:2:5, respectively.Assets at costP 480,000LiabilitiesP 135, 000Nina, Capital75, 000Pinta, Capital120, 000Santa Maria, Capital150,000P 480.000Nina is retiring from the partnership. By mutual agreement, the assets are to be adjusted to their fair value of P540, 000 at January 1, 2014.Pinta and Santa Maria agree that the partnership will pay Nina P135, 000 cash for her parlnership interest. There is no goodwill is to berecorded. What is the balance of Pinta's capital account after Nina's retirement?

Profit on revaluation of assets = Fair value - assets at cost = P540000 - 480000 = P60,000

Answered: The balance sheet for the partnership…

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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