The following information relates to partner for the year ended 29 February 2020:Current account credit balance on 29 February 202020 000Profit share50 000Salaries180 000Interest on capital24 000Drawings220 000Interest on drawings2 000What is the balance in the Current account of the partner on 01 March 2019?A. R12 000 DRO B. R116 000 DROC. R52 000 CRO D. R12 000 CR

Balance in the current account on 01 March 2019 = Beginning balance + Profit share + salaries +…

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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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The Statement of Financial Position of the XY partnership on December 31, 2018, appears below. $ 60,000 LIABILITIES $ 60,000 CASH OTHER ASSETS TOTAL ASSETS 200,000 a. $260,000 X, CAPITAL Y, CAPITAL TOTAL LIABILITIES AND CAPITAL 90,000 110,000 $260,000 X and Y share profits and losses in the ratio 50:50. Each of the following questions is independent of the others. Prepare journal entries for each of the following: Use bonus method where appropriate and show all computations. Refer to the above information. Assume that Z purchases a one-fourth proportionate capital interest directly from Y for a total of $60,000. (Direct purchase) b. Refer to the above information. Assume Z invests $60,000 cash into the XY partnership for a one-fourth interest in partnership capital and profits. c. Refer to the above information. Assume that Z invests $80,000 cash into the XY partnership for a one-fifth interest in partnership capital and profits.
A and B decided to form a partnership on January I, 2021. Their Statements ofFinancial Position on this date were: A B Cash 62,625 164,063 Accounts Receivable 1,487,500 896,875 Merchandise Inventory 875,000 885,938 Equipment 656,250 1,268,750 Total 3,084,375 3,215,625 A B Accounts payable 459,375 1,159,375 A, Capital 2,625,000 B, Capital 2,056,250 Total 3,084,375 3,215,625 They agreed the following adjustments shall be made:- Equipment of A is under depreciated by P87,500 and that B is over depreciated byP131,250.- Allowance for doubtful accounts is to be set up amounting to P297,500 for A andP196,875 for B.- Inventories of P21, 875 and P15,312 are worthless in the books of A and Brespectively.- The partnership agreement provides for a profit and loss ratio of 70% to A and 30%to B Assuming that the capital balances are to be equaled to their P&L Ratio, how much is the capital of A and B, respectively?
After the formation of RGM Partnership on July 4, 2023, the balances in the general ledger accounts reflect the following balances: Debit Credit Cash P 205,000 Accounts Receivable 95,000 Allowance for Doubtful Accounts P 10,000 Office Supplies 12,000 Office Equipment 320,000 Furniture and Fixture 140,000 Rosario, Capital 320,000 Guadalupe, Capital 225,000 Maria, Capital 217,000 Total P 772,000 P 772,000 Rosario invested the office equipment, Guadalupe invested accounts receivable and Furniture and Fixtures, and Maria invested cash and office supplies. Compute the total assets of the partnership upon formation.
Case 1 Mazin, Mansoor and Malik started a partnership firm on January 1, 2019. They contributed RO. 50,000, RO. 40,000 and RO. 30,000 respectively as their capitals and decided to share profits in the ratio of 3:2:1. The partnership deed provided that Mazin is to be paid salary of Ro. 12000 p.a. and Mansoor commission of RO. 2,500 every 6 months. It also provided that interest on capital be allowed @ 6% p.a. The drawings for the year were: Mazin RO. 6,000, Mansoor RO. 4,000 and Malik RO. 2,000. Interest on drawings was RO. 270 for Mazin, RO.180 for Mansoor and RO. 90 for Malik. The net amount of profit as per the profit and loss account for the year ended 2019 was RO. 35,660. Question: Prepare the necessary accounting entries, the profit and loss appropriation account and the partners' capital accounts. Based on the above information answer the following 3' questions. (Do not upload any documents in the moodle) The amount of interest on capital the partners are eligible to receive…
Problem: ABC Partnership was formed in year 2021. Just before distribution of profit and loss, the following accounts appeared in the books of the partnership at the end of year 2021. В. сарital A, capital 5/1 5,000 1/1 75,000 10/1 9/1 115,000 20,000 1/1 6/30 90,000 60,000 С, саpital 8/1 50,000 1/1 235,000 Revenue and expense summary 240,000 6/1 100,000 X If profits are divided as follows, what is the share of A? * a. An 8% interest is given to each partners' ending capital. b. Partners A and B will receive P2,500 monthly salary while partners C will receive P3,000 monthly. C. 10% bonus based on income after bonus is given to A. d. Residual income is divided based on their ending capital.
Question 6 For the year 2021, the partnership of AMMAR and BANU realized a net profit of P240,000. The capital accounts of the partners show the following postings: Jan. 1 May 1 July 1 Aug. 1 Oct. 1 AMMAR Debit Credit Debit Credit 20,000 10,000 120,000 BANU 10,000 10,000 5,000 80,000 20,000
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On January 31, 20x4, partners of VIP, LLP, had the following loan and capital account balances (after closing entries for January): Loan Receivable from V Loan Payable to P V, capital P40,000 dr 120,000 cr 60,000 dr 240,000 cr 140,000 cr I, capital P, capital The partnership's income sharing ratio was V, 50%; I, 20%; P, 30%. On January 31, 20x4, BJ was admitted to the partnership for a 20% interest in total capital of the partnership in exchange for an investment of P80,000 cash. Prior to BJ's admission, the existing partners agreed to increase the carrying amount of the partnership's inventories to current fair value, a P120,000 increase. The capital account to be credited to BJ:
Vusi and Vuma are in partnership trading as VV Traders specialising in manufacturing protective wear related to COVID-19. The partners share profits equally. The following information pertains to the business activities of the partnership for the year ended 30 June 20.2: VV TRADERS EXTRACT OF FINANCIAL INFORMATION AS AT 30 JUNE 20.2 Note R Loan to Vusi Land and buildings (at cost) Machinery (at cost) Vehicles (at cost) Accumulated depreciation: Machinery Accumulated depreciation: Vehicles Allowance for credit losses Capital contribution: Vusi Capital contribution: Vuma Allowance for settlement discount granted Long-term loan Inventory Trade receivables control Trade payables control Bank Petty cash Current account: Vusi (1 July 20.1) Current account: Vuma (1 July 20.1) 92 650 462 330 160 690 Cell Styles 201 580 29 220 9 810 3 710 350 280 350 280 8 940 70 850 49 490 97 450 41 530 84 590 1 570 42 840 63 220 Profit before year-end adjustments 170 370 Additional information 1. The…
Tanya and Uma, each operating a separate business agreed to join in partnership as of July 1, 2020. The account balances presented by each partner as of this date were as follows: Accounts Cash Accounts Receivable Merchandise Inventory Office Equipment Total Assets Accounts Payable Notes Payable Capitals Total Liabilities and Capital Tanya P 32,000 3,200 40,000 10,000 P 85,200 P 10,000 2,000 73,200 P 85,200 Uma P 12,000 24,000 36,000 12,000 P 84,000 P 16,000 68,000 P 84,000 The assets of the two partners were carefully examined and it was agreed that certain adjustments be made, and the above statements of financial position as adjusted be the basis on which the partnership begins operations. The adjustments agreed upon are as follows: a. Tanya's accounts receivables are to be taken over at a book value less 15% and Uma's accounts receivable at book value less 10%. b. Tanya's office equipment is new and is considered adequate for the new business, therefore, it is decided that Uma…
The partnership has the following accounting amounts: Sales 70,000 Interest paid to banks 40,000 Partners' withdrawals 10,000 Cost of goods sold Operating expenses The partnership net income (loss) is: O A. 20,000 O B. 18,000 O C. 5,000 O D. (3,000) Salary allocations to partners 2,000 8,000 13,000
On Demeber 31, 20x20, the Statement of Financial Position of ABC Partnership with profit or loss ratio of 5:3:2 of respective partners.

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