1. What is the capital of Jack and Jill after the above adjustments? Jack Jill Jack JillA. 650,000 ; 760,000 C. 687,500 ; 772,500B. 650,000 ; 810,000 D. 750,000 ; 810,0002. What is the total assets of the partnership after the formation?A. 1,460,000 C. 1,895,000B. 1,855,000 D. 2,000,000 On October 1, 2020, Jack and Jill pooled their assets to form a partnership, with the firm to take over thebusiness assets and assume the liabilities. The partners capital are to be based on the net assetstransferred after the following adjustments.Jil's invenory is to be increased by P40,000; an allowance for doubtful account of P10,000 and P15,000are to be set up in the books of Jack and Jill respectively; and asccrued expenses of P40,000 is to berecognized in Jack's Books. The partners agree to allocate profts and losses equally.The individual trial balances on October 1, before adjustment follow:JackJillAssetsLiabilities750,000.0050,000.001,120,000.00345,000.00

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Answered: What is the capital of Jack and Jill…

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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1. What is the capital of Jack and Jill after the above adjustments?
Jack Jill Jack Jill
A. 650,000 ; 760,000 C. 687,500 ; 772,500
B. 650,000 ; 810,000 D. 750,000 ; 810,000

2. What is the total assets of the partnership after the formation?
A. 1,460,000 C. 1,895,000
B. 1,855,000 D. 2,000,000

On October 1, 2020, Jack and Jill pooled their assets to form a partnership, with the firm to take over the
business assets and assume the liabilities. The partners capital are to be based on the net assets
transferred after the following adjustments.
Jil's invenory is to be increased by P40,000; an allowance for doubtful account of P10,000 and P15,000
are to be set up in the books of Jack and Jill respectively; and asccrued expenses of P40,000 is to be
recognized in Jack's Books. The partners agree to allocate profts and losses equally.
The individual trial balances on October 1, before adjustment follow:
Jack
Jill
Assets
Liabilities
750,000.00
50,000.00
1,120,000.00
345,000.00

Definition Definition Arrangement between two or more people whereby they agree to manage business operations and share its profits and losses in an agreed ratio. The agreement drafted and signed by the partners of the firm is termed as a partnership deed and contains various important clauses agreed between the partners such as profit/loss sharing, interest on capital, remuneration allocation of each partner, and drawings of a partner.

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