The condensed balance sheet of Adams & Gray, a partnership at December 31, 2008, follows: Current assets 250,000 Equipment (net) 30,000 Liabilities 20,000 Adams, capital Gray, capital 160,000 100,000 On December 31, 2008, the fair values of the assets and liabilities were appraised at P240,000 and P20,000, respectively, by an independent appraiser. On January 2, 2009, the partnership was incorporated and 1,000 shares of P5 par value common stock were issued. Immediately after the incorporation, what amount should the new corporation report as share premium?

The condensed balance sheet of Adams & Gray, a partnership at December 31, 2008, follows: Current assets 250,000 Equipment (net) 30,000 Liabilities 20,000 Adams, capital Gray, capital 160,000 100,000 On December 31, 2008, the fair values of the assets and liabilities were appraised at P240,000 and P20,000, respectively, by an independent appraiser. On January 2, 2009, the partnership was incorporated and 1,000 shares of P5 par value common stock were issued. Immediately after the incorporation, what amount should the new corporation report as share premium?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

On October 1, A and B pooled their assets to form a Partnership, with the firm to take over the business assets and assume liabilities. Partners capitals are to be based on net assets transferred after the following adjustments. The partners agreed to the following adjustments: A’s inventory is to be increased by P15,000, while B’s inventory has a current fair market value of P100,000 and an agreed value of P110,000. B’s unadjusted inventory amounted to P90,000. Machinery and equipment are over-depreciated by P5,000 and P8,000 for A and B, respectively. Furnitures and fixtures for partner A has a current fair market value of P60,000 and an agreed value of P50,000. Furnitures and fixtures is carried at its cost amounting to P100,000 with accumulated depreciation of P45,000. Accrued rent income of P10,000 for A, and accrued salaries of P5,000 for B should be recognized on their respective books. The individual trial balances on October 1, before adjustments, follow: DESCRIPTION A…
On October 1, A and B pooled their assets to form a Partnership, with the firm to take over the business assets and assume liabilities. Partners capitals are to be based on net assets transferred after the following adjustments. The partners agreed to the following adjustments: A’s inventory is to be increased by P15,000, while B’s inventory has a current fair market value of P100,000 and an agreed value of P110,000. B’s unadjusted inventory amounted to P90,000. Machinery and equipment are over-depreciated by P5,000 and P8,000 for A and B, respectively. Furnitures and fixtures for partner A has a current fair market value of P60,000 and an agreed value of P50,000. Furnitures and fixtures is carried at its cost amounting to P100,000 with accumulated depreciation of P45,000. Accrued rent income of P10,000 for A, and accrued salaries of P5,000 for B should be recognized on their respective books. The individual trial balances on October 1, before adjustments, follow: DESCRIPTION A…
The following is the trail Balance of X and Y Co. as on March 31, 2021. The partners sharing profits and losses in the ratio 2:1. Prepare the Income Statement, Profit & Loss Appropriation A/c, Partners' Capital A/c and the Balance Sheet. Particulars Dr. Particulars Cr. 375000 x Capital A/c 112500 Y Capital A/c 50000 Sundry creditors 100000 Sales (net) 50000 Discount Land and Buildings Plant and Machinery 125000 75000 Wages 62500 Opening Stock of Finished Goods 812500 Opening Stock of Raw material Opening Stock of Work in Progress Sundry debtors 6250 45000 Provision for bad debts 3750 125000 Commission 3750 Y's Loan A/c 2250 25000 Carriage inwards 75000 Carriage outwards Factory Expenses 18750 Royalties 3750 Purchase of Raw material (net) 187500 16250 7250 10000 Factory rent & taxes Discount Office rent Insurance 5000 3750 18750 30000 20500 1185000 The following additional information is to be taken into consideration: Bad debts Office Expenses Salaries of works manager Cash at bank…
On December 31, 2030, the Statement of Financial Position of ABC Partnership provided the following data with profit or loss ratio of 5:1:4:Current Assets P 3,000,000 Total Liabilities P 1,000,000 Noncurrent Assets 4,000,000 A, Capital 2,200,000B, Capital 2,400,000C, Capital 1,400,000 On January 1, 2030, D is admitted to the partnership by investing P1,000,000 to the partnership for 10% capital interest. The total agreed capitalization of the new partnership is P6,000,000. What is the capital balance of D after his admission to the partnership?a. P1,000,000b. P600,000c. P700,000d. P800,000
Following is the statement of financial position of ABC Partnership before realization of assets on July 1, 2020: Cash 10,000 Liabilities 28,000 Accounts 50,000 A, Capital 45,000 receivable Inventory 30,000 B, Capital 27,000 Equipment 60,000 C, Capital 50,000 Total 150,000 Total 150,000 The partners share income 30:30:40, respectively. On July 2, the partnership liquidated, 50% of the receivables are collected and that inventory is fully written-off. Equipment is sold for 55,000. Determine payment to partner B.
The capital balance and the profit and loss sharing ratio of the partnership S, T and U as of December 31, 2010 are: Capital S (30%) $80,000,000 Capital T (50%) $90,000,000 Capital U (20%) $70,000,000 The partners agreed to accept V into the partnership on January 1, 2011, for an interest in capital and operating profit. Requested 1. Journalize V's entry into the partnership assuming that he invested $50,000,000 into the partnership for a 20% ownership interest and that the partnership capital is revalued. 2 Journalize Vs entry into the partnership assuming that he invested $70,000 in the partnership for a 20% ownership interest and that the partnership capital is revalued.
Ledger balances of the OMG partnership as of May 31, 2019 are as follows:Cash P 150,000Other Assets 1,080,000Accounts Payable P 450,000Olga, Capital 480,000Mega, Capital 135,000Giga, Capital 165,000Profits and losses are shared 4:5:1 to Olga, Mega and Giga, respectively. If the partnership is liquidated in installments and assuming that as cash becomes available, it will be distributed to the partners; Inventory costing P 600,000 is sold for P 420,000, How much cash should be distributed to each partner at this time?
The A & B Partnership was established since 2005. On January 1, 2015, the partners agree to admit partner (C). Capital account balances and profit and loss sharing ratios at January 1, 2015, before the admission of partner (C), are as follows: Partner (A) (30%) $63,000 Partner (B) (70%) $97,000 Partner (C) invested $120,000 cash to the partners for 60% of capital interest and the partners agree about assets revaluation. The capital balance of partner B after admission is a. $82,000. a. $82,000. b. $78,000. b. $78,000. c. $91,000. c. $91,000. d. $97,000.
The following balance sheet accounts were taken from the partnership of ABC Co. on March 31, 2015: Cash-P500,000; Other Assets- P3,600,000; Liabilities-P1,040,000; Aly, Capital (40%)-P800,000; Bea, Capital (40%)-P1,300,000 and Cai, Capital (20%)-P960,000. The partnership was liquidated by installment. The proceeds from the first sale of non-cash assets with a book value of P1,800,000 amounted to P1,000,000. In the first month, P640,000 of the liabilities and P50,000 of unrecorded liabilities were paid. The partners also set aside P100,000 for future expenses.How much is the cash balance after the first installment payment?
The K & L Partnership was established since 2005. On January 1, 2015, the partners agree to admit partner (M). Capital account balances and profit and loss sharing ratios at January 1, 2015, before the admission of partner (M), are as follows: Partner (K) (30%) $63,000 Partner (L) (70%) $97,000 at the time of admission the following assets have a book value and fair value as: Book Value Fair value Inventory 100,000 120,000 Building 130,000 100,000 Partner (M) invested $120,000 cash to the partners for 40% of capital interest and the partners agree about assets revaluation. The journal entry to record the goodwill is a. Dr. Goodwill $35,000 / Cr. (M) capital $35,000. a. Dr. Goodwill $35,000 / Cr. (M) capital $35,000. b. Dr. Goodwill $30,000 /Cr. (K) capital $9,000, (L)…
The information given below was extracted from the accounting records of Total Limited, a partnership business with Glen and Murry as partners. Information: Extract from the ledger of Total Limited on 30 June 2021 R Capital : Glen 400 000 Capital: Murry 300 000 Current a/c: Glen (01 July 2020) 45 000 CR Current a/c: Murry (01 July 2020) 42 000 DR Drawings: Glen 95 000 Drawings: Murry 110 000 The following must be taken into account: 1. On 30 June 2021 the Profit and Loss account reflected a net profit of R940 000. 2. Partners are entitled to interest at 14% p.a. on their capital balances. Note: Glen decreased his capital contribution by R90 000 on 01 July 2020. This capital decrease has been recorded. 3. Partners are entitled to the following monthly salaries: Glen R13 000 for the first ten months of the financial year and R15 000 for the next two months. • Murry R10 000 per month throughout the year. 4. Partner Murry is entitled to a bonus equal to 10% of the net profit before any of…
The condensed statement of financial position of the partnership of Buenaflor and Gangoso as of December 31, 2020 showed the following: Total assets P 200, 000Total liabilities 40, 000Buenaflor, Capital 80, 000Gangoso, Capital 80, 000 On this date, the partnership was dissolved and its net assets transferred to a newly formed corporation.The fair value of the assets was P 24, 000 more than the carrying value on the firm’s books. REQUIRED: Prepare the journal entries in the books of the corporation with P 1 par ordinary share.