The capital accounts of the partnership of Bato, Bong, and Bongbong on June 1, 2005 are presentedbelow with their respective profit and loss ratios:BatoP139,2001/2Bong208,8001/396.000P444.000Bongbong1/6On June 1, 2005, Pacman is admitted to the partnership when he purchased, for P132,000, aproportionate interest from Bato and Bong in the net assets and profits of the partnership. As a resultof a transaction, Pacman acquired a one-fifth interest in the net assets and profits of the firm.Assuming that implied goodwill is not to be recorded, what is the combined gain realized by Batoand Bong upon the sale of a portion of their interest in the partnership to Pacman?

The partnership comes into existence when two or more persons agree to do the business and share…

Answered: The capital accounts of 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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Banzon and Borja are partners in B&B Enterprises. Partnership profits and losses are allocated as follows: Salaries - P160,000 and P200,000 to Banzon and Borja, respectively • 10% interest on the beginning capital balances Any remaining profit is divided equally At the beginning of the year, their capital balances are: P360,000 for Banzon and P600,000 for Borja. What portion of the partnership income of P600,000 will be allocated to Banzon?
The E.N.D. partnership has the following capital balances as of the end of the current year: Pineda $ 270,000 Adams 240,000 Fergie 230,000 Gomez 220,000 Total capital $ 960,000 Answer each of the following independent questions: Assume that the partners share profits and losses 3:3:2:2, respectively. Fergie retires and is paid $269,000 based on the terms of the original partnership agreement. If the goodwill method is used, what is the capital balance of the remaining three partners? Assume that the partners share profits and losses 4:3:2:1, respectively. Pineda retires and is paid $355,000 based on the terms of the original partnership agreement. If the bonus method is used, what is the capital balance of the remaining three partners? (Do not round your intermediate calculations. Round your final answers to the nearest dollar amounts.)
A, B and C are partners sharing profits in the ratio of 3:3:2. On June 30, their capital balances are as follows: A, 720, 000; B, 480, 000 and C, 360, 000. Dong will directly purchase 1/3 of A’s interest for 250, 000 and no bonus or goodwill is to be recognize before the direct purchase of A’s interest. In addition, Dong is also to invest 380, 000 cash in the partnership. The total capital of the partnership after the admission is to be 2, 000, 000. Dong’s interest after his admission by direct purchase and investment is to be 30%. c. What is the capital balance of A after the admission by direct purchase and admission by investment of Dong? d.What is the capital balance of B after the admission by direct purchase and admission by investment of Dong?
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Myles Etter and Crystal Santori are partners who share in the income equally and have capital balances of $199,800 and $62,680, respectively. Etter, with the consent of Santori, sells one-third of his interest to Lonnie Davis. Assume the sale occurs on December 31. What entry is required by the partnership if the sales price is (a) $66,600? (b) $87,700?
After the tangible assets have been adjusted to current market prices, the capital accounts of Grayson Jackson and Harry Barge have balances of $64,900 and $86,500, respectively. Lewan Gorman is to be admitted to the partnership, contributing $43,300 cash to the partnership, for which he is to receive an ownership equity of $50,500. All partners share equally in income. a. Journalize the entry to record the admission of Gorman, who is to receive a bonus of $7,200. If an amount box does not require an entry, leave it blank. Cash Grayson Jackson, Capital Harry Barge, Capital Lewan Gorman, Capital b. What are the capital balances of each partner after the admission of the new partner? Partner Balance Grayson Jackson $ Harry Barge $ Lewan Gorman $
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The following balances as of the end of 2009 for the partnership of ping, pong, and pang, together with their respective profit and loss percentages, were as follows:Assets - 360,000; ping, loan - 18,000; ping, capital (20%) - 84,000; pong, capital (20%) - 78,000; pang, capital (60%) - 180,000ping decided to retire from the partnership. Parties agreed to adjust the assets to their fair market value of P420,000 as of December 31, 2009. ping will be paid P98,000 for ping’s total partnership interest (amount is inclusive of ping's loan). No goodwill is to be recorded. After ping’s retirement, what will be the balance of pong’s capital account?
Celso, Lino and Noel are partners with capital balances of P180,000, P100,000 and P120,000 respectively. Joel is admitted into the partnership with a one-fourth interest upon payment of P160,000. If the old partners share profits and losses in the ration of 2/5,2/5 and 1/5, then the capital account of Celso after the admission of Joel will show a balance of: a.) P180,000 b.) P160,000 c.) P172,000 d.) P188,000 SHOW COMPLETE SOLUTION

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