1
CHAPTER 2 Partnership Dissolution EXERCISES Exercise 2 – 1 1. 2.
Sales, Capital Rosales, Capital
140,000 140,000
P280,000 + P320,000 + P200,000 = P800,000
Exercise 2 –2 1.
Total capital (P3,000,000 / 80%) Capital interest of Fidel Cash to be contributed by Fidel
2.
Cash Fidel, Capital
P3,750,000 x 20% P 750,000 750,000 750,000
Exercise 2 – 3
1. Centeno, Capital Corales, Capital
40,000
Other Assets Cortes, Capital Centeno, Capital Claudio, Capital P140,000/ ¼ = P560,000 – (P200,000 + P 160,000 + P120,000)
80,000
Cortes, Capital P200,000 + P50,000 x 1/4 Centeno, Capital P160,000 + P20,000 x 1/4 Claudio, Capital P120,000 + P10,000 x 1/4 Corales, Capital
62,500 45,000 32,500
40,000
2. 50,000 20,000 10,000
140,000
3. Cash
230,000 Cortez, Capital Centeno, Capital Claudio, Capital Corales, Capital old (3/4) new (1/4)
32,812 13,125 6,563 177,500 AC P532,500 177500 P710,000
CC P480,000 230,000 P710,000
Bonus_ P52,500 (52,500) P---0---
AA 1 - Chapter 2 (2008 edition)
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Exercise 2 – 4
1. Conde, Capital Cuenco, Capital Catral, Capital
90,000 60,000 150,000
2. Other Assets Conde, Capital Cuenco, Capital
360,000
Conde, Capital P270,000 + 270,000 x 1/3 Cuenco, Capital P180,000 + P90,000 x 1/3 Catral, Capital
180,000 90,000
Cash
270,000
270,000 90,000
270,000
3. Conde, Capital Cuenco, Capital Catral, Capital old (3/4) new (1/4)
67,500 22,500 180,000 AC P540,000 180,000 P720,000
CC P450,000 270,000 P720,000
Bonus_ P90,000 (90,000) P---0---
4. Cash Other Assets Conde, Capital Cuenco, Capital Catral, Capital old (3/4) new (1/4)
270,000 360,000 270,000 90,000 270,000 AC P 810,000 270,000 P1,080,000
CC P450,000 270,000 P720,000
Asset Re P360,000 P360,000
5. Cash Conde, Capital Cuenco, Capital Catral, Capital
270,000 67,500 22,500 360,000
Exercise 2-5 1a. Bonus Method Cash Alba, Capital Medel, Capital Almeda, Capital old (3/4) new (1/4) 1b.
180,000 6,000 9,000 195,000 AC P585,000 195,000 P780,000
CC P600,000 180,000 P780,000
Bonus_ P(15,000) 15,000 P---0---
Revaluation of Assets Method (AC = P180,000 ÷ 1/4 = P720,000)
AA 1 - Chapter 2 (2008 edition)
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Alba, Capital (P60,000 x 40%) Medel, Capital (P60,000 x 60%) Other Assets (P780,000 - P720,000) To record revaluation of assets
24,000 36,000 60,000
Cash Almeda, Capital 2.
180,000 180,000
Balances under the bonus method
Alba P194,000
Medel P391,000
Almeda P195,000
Balances under the asset rev. method Additional depreciation Balances after depreciation
P200,000 ( 6,666) P193,334
P400,000 ( 6,667) P393,333
P200,000 ( 6,667) P193,333
Net advantage to Medel using the asset revaluation method
P
2,333
Exercise 2 - 6 1.
2.
Garces, Capital Kalaw, Capital P120,000 x 1/2 = P60,000
60,000
Cash Other Assets (P400,000 – P320,000) Kalaw, Capital Garces, Capital (P100,000 x 3/8) Hilario, Capital (P100,000 x 3/8) Juan, Capital (P100,000 x 2/8) Total agreed capital Total capital contribution Asset revaluation
60,000 80,000
60,000
40,000 37,500 37,500 25,000 P400,000 320,000 P 80,000
Interest acquired from Garces Cash invested in the partnership Total Capital credit of Kalaw Bonus to old partners
P 60,000 60,000 P 120,000 100,000 P 20,000
Exercise 2 – 7 Bonus method Capital before admission of Estacio Contribution of Estacio Bonus to old partners Capital after admission of Estacio
Sabado P1,000,000
Galman P800,000
24,000 P1,024,000
16,000 P816,000
Sabado P1,000,000
Galman P800,000
120,000
80,000
Estacio P500,000 ( 40,000) P460,000
Total P1,800,000 500,000 P2,300,000
Asset Revaluation method Capital before admission of Estacio Contribution of Estacio Adjustment of fixed assets to fair value
Estacio P500,000
Total P1,800,000 500,000 200,000
AA 1 - Chapter 2 (2008 edition)
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Capital after admission of Estacio
P1,120,000
P880,000
P500,000
P2,500,000
Exercise 2 – 8 1. Bonus method Capital balances before admission of new partners Contributions of new partners Bonus to old partners Capital balances after admission of new partners
Noble
Calma
P64,000
P136,000
10,950
25,550
P74,950
P161,550
Reyes
Naval
P110,000 ( 24,000)
P120,000 ( 12,500)
P86,000
P107,500
Cash Equipment Noble, Capital Calma, Capital Reyes, Capital Naval, Capital
Total P200,000 230,000 P430,000
130,000 100,000 10,950 25,550 86,000 107,500
2. Asset Revaluation method Capital balances before admission of new partners Adjustment of assets to FV Contributions of new partners Capital balances after admission of new partners
Noble
Calma
P64,000 9,000
P136,000 21,000
P73,000
P157,000
Reyes
Naval
Total
P110,000
P120,000
P200,000 30,000 230,000
P110,000
P120,000
P460,000
Cash Equipment Inventory Land Building Noble, Capital Calma, Capital Reyes, Capital Naval, Capital Exercise 2 - 9 1a. Bonus Method Songco, Capital Bueno, Capital Manzano, Capital Cash/Payable to Songco 1b. Asset Revaluation Method Songco, Capital Other Assets (P10,000 ÷ 1/6) Bueno, Capital (P50,000 x 3/5) Manzano, Capital (P50,000 x 2/5) Cash/ Payable to Songco 2. The bonus method will be preferred by Manzano
130,000 84,000 14,000 80,000 48,000 9,000 21,000 110,000 120,000 200,000 60,000 40,000 300,000 200,000 600,000 300,000 200,000 300,000
AA 1 - Chapter 2 (2008 edition)
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Capital of Manzano after retirement Additional depreciation Capital of Manzano after additional depreciation Net advantage to Manzano with the use of the bonus method
Bonus Method P260,000 P260,000
Asset Rev P500,000 300,000 P200,000
P60,000
Exercise 2 – 10
1. Delfin, Capital Damian, Capital Dencio, Capital
400,000
Delfin, Capital Cash Damian, Capital Dencio, Capital
400,000
Other Assets Delfin, Capital Cash Damian, Capital Dencio, Capital P460,000 – P400,000 = P60,000/ 1/3 = P180,000
180,000 400,000
200,000 200,000
2. 320,000 40,000 40,000
3. 460,000 60,000 60,000
Exercise 2 – 11
1.
Guzman, Capital January 1 Drawing Share in net profit Interest of Guzman upon retirement
P100,000 (16,000) 24,000 P108,000
Other Assets Guzman, Capital Cash Jorge, Capital Lopez, Capital P120,000 – P108,000 = P12,000/ 30% = P40,000
40,000 108,000
Guzman, Capital Jorge, Capital Lopez, Capital Cash
108,000 5,143 6,857
120,000 12,000 16,000
2.
120,000
Exercise 2 – 12 1.
Building Villa, Capital Belen, Capital
200,000 60,000 40,000
AA 1 - Chapter 2 (2008 edition)
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Marcos, Capital Cordero, Capital
2.
80,000 20,000
Belen, Capital Cash
140,000
Villa, Capital Belen, Capital Marcos, Capital Cordero, Capital Cash
15,000 100,000 20,000 5,000
140,000
140,000
Exercise 2 - 13 1.
2. 3.
4.
5.
6.
Galang, Capital Henio, Capital Israel, Capital Cash
12,000 8,000 140,000
Israel, Capital Galang, Capital
140,000
Israel, Capital Cash Galang, Capital Henio, Capital
140,000
Other Assets Israel, Capital Cash Galang, Capital Henio, Capital
48,000 140,000
Israel, Capital Galang, Capital Henio, Capital Cash Other Assets Israel, Capital Henio, Capital
140 000 60,000 40,000
160,000 140,000 130,000 6,000 4,000
148,000 24,000 16,000
120,000 120,000 140,000 140,000 PROBLEMS
Problem 2 - 1 1.
2.
Locsin, Capital (P240,000 x 1/4) Montes, Capital (P120,000 x 1/4) Nava, Capital
60,000 30,000
Locsin, Capital (P240,000 x 1/3) Montes, Capital (P120,000 x 1/3) Nava, Capital
80,000 40,000
90,000
120,000
AA 1 - Chapter 2 (2008 edition)
3.
4.
5.
6.
7.
8.
9.
10
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Other Assets Locsin, Capital (P180,000 x 3/4) Montes, Capital (P180,000 x 1/4) P540,000 – P360,000 = P180,000
180,000
Locsin, Capital [(P240,000 + P135,000) 1/3] Montes, Capital [(P120,000 + P45,000) 1/3] Nava, Capital
125,000 55,000
Cash Locsin, Capital (P90,000 x 3/4) Montes, Capital (P90,000 x 1/4) Nava, Capital AC old (1/2) 270,000 new (1/2) 270,000 540,000
180,000 67,500 22,500
135,000 45,000
180,000
270,000 CC 360,000 180,000 540,000
Cash Other Assets Nava, Capital Locsin, Capital (P60,000 x 3/4) Montes, Capital (P60,000 x 1/4) AC CC old (3/4) 540,000 360,000 new (1/4) 180,000 180,000 720,000* 540,000 *180,000 ÷ 1/4 = 720,000
Bonus (90,000) 90,000 ----180,000 180,000 180,000 135,000 45,000 Asset Rev 180,000 ----180,000
Cash Nava, Capital Locsin, Capital (P60,000 x 3/4) Montes, Capital (P60,000 x 1/4)
240,000
Cash Locsin, Capital Montes, Capital Nava, Capital
240,000 54,000 18,000
Cash Locsin, Capital (P22,500 x 3/4) Montes, Capital (P22,500 x 1/4) Nava, Capital (P510,000 x 1/4)
150,000
Cash Other Assetsl (P660,000 – P525,000) Locsin, Capital (P135,000 x 3/4) Montes, Capital (P135,000 x 1/4) Nava, Capital (P660,000 x 1/4)
165,000 135,000
Cash
144,000
180,000 45,000 15,000
312,000 16,875 5,625 127,500
101,250 33,750 165,000
AA 1 - Chapter 2 (2008 edition)
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Locsin, Capital (P24,000 x 3/4) Montes, Capital (P24,000 x 1/4) Nava, Capital (P504,000 x 1/3)
18,000 6,000 168,000
Problem 2 - 2 1. a. Ponce, Capital (P300,000 x ½) Anton, Capital b.
c.
b.
c.
150,000
Ponce, Capital (P300,000 x ¼) Salva, Capital (P200,000 x ¼) Victa, Capital (P100,000 x ¼) Anton, Capital
75,000 50,000 25,000 150,000
Cash Ponce, Capital Salva, Capital Victa, Capital Anton, Capital Ponce Salva Victa Anton
2. a.
150,000
220,000 7,500 4,500 3,000 205,000 AC P307,500 204,500 103,000 205,000 P820,000
CC P300,000 200,000 100,000 220,000 P820,000
Bonus P 7,500 4,500 3,000 ( 15,000) ------
Other Assets Ponce, Capital Salva, Capital Victa, Capital P960,000 – P600,000 = P360,000
360,000
Ponce, Capital Anton, Capital
240,000
Other Assets Ponce, Capital Salva, Capital Victa, Capital P180,000/ 25% = P720,000 – P600,000 = P120,000
120,000
180,000 108,000 72,000
240,000 60,000 36,000 24,000
Ponce, Capital Salva, Capital Victa, Capital Anton, Capital
90,000 59,000 31,000
Other Assets Ponce, Capital Salva, Capital Victa, Capital P220,000/ 25% = P880,000 – P820,000 = P60,000
60,000
180,000 30,000 18,000 12,000
AA 1 - Chapter 2 (2008 edition)
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Cash Anton, Capital
220,000 220,000
Problem 2-3 1.a Cash Cabral, Capital Corpus, Capital Carlos, Capital Other Assets Camus, Capital old (3/4) new (1/4) b.
90,000 22,500 18,000 4,500 45,000 90,000 AC 630,000 90,000 720,000*
CC 675,000 90,000 765,000
Asset Rev (45,000) ----(45,000)
Cash Cabral, Capital Corpus, Capital Carlos, Capital Camus, Capital old (1/2) new (1/2)
2.a
b.
90,000 2,813 2,250 562 95,625 AC 669,375 95,625 765,000
CC 675,000 90,000 765,000
Cabral, Capital Corpus, Capital Carlos, Capital Camus, Capital Other Assets Cabral, Capital Corpus, Capital Carlos, Capital P90,000/ 1/8 = P720,000 – P675,000 = P45,000
40,500 27,000 16,875
Cabral, Capital Corpus, Capital Carlos, Capital Camus, Capital
43,312 29,250 17,438
Problem 2 - 4 1. a. Inventories Accumulated Depreciation – Equipment Allowance for Doubtful Accounts Accrued Liabilities Roces, Capital (P6,750 x 60/100) Lapuz, Capital (P6,750 x 40/100) b. c.
Bonus (5,625) 5,625 -----
Cash Doria, Capital P187,500/80% = P234,375 x 20% = P46,875 Lapuz, Capital
84,375 45,000 22,500 18,000 4,500
90,000 5,625 7,500 3,450 2,925 4,050 2,700 46,875 46,875 13,388
AA 1 - Chapter 2 (2008 edition)
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Roces, Capital Roces = (P234,375 x 50%) – P103,800 = P13,388 Lapuz = (P234,375 x 30%) - P83,400 = (P13,388)
13,388
2. Roces, Lapuz and Doria Statement of Financial Position April 1, 2008 ASSETS Cash Receivables Less Allow. for DA Inventories Equipment Less Acc. Depr. TOTAL ASSETS
P 82,875 P69,000 3,450 P52,500 26,250
65,550 129,375 26,250 P304,050
LIABILITIES and PARTNERS’ CAPITAL Payables P66,750 Accrued Liabilities 2,925 Roces, Capital P117,188 Lapuz, Capital 70,312 Doria, Capital 46,875 234,375 ________ TOTAL LIABILITIES and PARTNERS’ CAPITAL P304,050
Problem 2 -5 Roldan P150,000
Angeles P180,000 (30,000)
Bal.before admission of Moreno Transfer of 1/6 int. to Moreno Investment of Moreno Asset revaluation 6,000 6,000 Bonus to old partners 6,000 6,000 Capital balances after admission of Moreno P162,000 P162,000 2. Roldan 30% x 75% = 22.5% Angeles 30% x 75% = 22.5% Lazaro 40% x 75% = 30% Moreno 25%
Lazaro P300,000
Moreno
Total P630,000
P 30,000 150,000 8,000 8,000 P316,000
150,000 20,000
(20,000) P160,000
P800,000
Problem 2 – 6 1.
Lazo, Capital Madrid, Capital Buildings Allowance for Doubtful Accounts Allowance for Valuation of Investments
19,000 19.000
Lazo, Capital Madrid, Capital Nuguid, Capital (P200,000 – P19,000 + P19,000 – P20,000) 1/3 = P60,000 (P150,000 – P19,000 + P19,000 – P14,000) 1/3 = P45,333
60,000 45,333
2. Capital balances before admission of Nuguid Revaluation of assets Capital balances after revaluation Fraction of interest transferred to Nuguid Interest transferred to Nuguid
8,000 20,000 10,000
Lazo P199,000 ( 19,000) P180,000 x 1/3 P 60,000
Madrid P155,000 ( 19,000) P136,000 x 1/3 P 45,333
105,333
Total P354,000 ( 39,000) P316,000 x 1/3 P105,333
AA 1 - Chapter 2 (2008 edition)
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Gain on transfer Cash distribution to partners
31,138 P 91,138
23,529 P 68,862
Capital balances before admission of Nuguid Revaluation of assets Interest transferred to Nuguid Balances Share in net profit Drawings Capital balances, December 31, 2008
Lazo P199,000 ( 19,000) ( 60,000) P120,000 18,000 ( 15,000) P123,000
Madrid P155,000 ( 19,000) ( 45,333) P 90,667 18,000 ( 12,000) P 96,667
3.
4.
Cash Accounts Receivable Investments Accounts Payable Osorio, Capital
54,667 P160,000 Nuguid 105,333 P105,333 18,000 ( 28,000) P 95,333
66,000 40,000 20,000 41,000 85,000
Lazo, Capital Madrid, Capital Nuguid, Capital Osorio, Capital
5,000 5,000 5,000 15,000
P315,000 + P85,000 = P400,000 x 1/4 P100,000 – P85,000 = P15,000
Problem 2 - 7 1.
2.
3.
4.
Montero, Capital Concio, Capital (P8,000 x 3/5) Domino, Capital (P8,000 x 2/5) Cash
100,000 4,800 3,200
Montero, Capital Concio, Capital (P10,000 x 3/5) Domino, Capital (P10,000 x 2/5) Cash
100,000
Montero, Capital Concio, Capital (P60,000 x 3/6) Domino, Capital (P60,000 x 2/6) Cash Other Assets (P10,000 ÷ 1/6)
100,000 30,000 20,000
Montero, Capital (P6,000 x 1/6) Concio, Capital (P6,000 x 3/6) Domino, Capital (P6,000 x 2/6) Equipment [(P60,000 x 40%) – P18,000] Montero, Capital Equipment Cash
(P100,000 – P1,000)
108,000 6,000 4,000 90,000
90,000 60,000 1,000 3,000 2,000 6,000 99,000 18,000 81,000
AA 1 - Chapter 2 (2008 edition)
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Problem 2-8 1.
Damaso P120,000 ( 9,600) ( 24,000) P 86,400
Capital, January 1, 2008 Share in net loss Drawings Capital balances, December 31, 2008 2.
3. a
Dangwa P 70,000 ( 6,400) ( 24,000) P 39,600
Dangwa, Capital Dmaso, Capital Datu, Capital Cash Inventory P39,600 – P30,000 = P9,600 / 20% = P48,000
Datu P 80,000 ( 16,000) ( 24,000) P 40,000
39,600 14,400 24,000 30,000 48,000
Other Assets Dangwa, Capital Cash Damaso, Capital Datu, Capital P48,000 – P39,600 = P8,400/ 20% = P42,000 Dangwa, Capital Damaso, Capital Datu, Capital Cash
42,000 39,600 48,000 12,600 21,000 39,600 3,150 5,250 48,000
Problem 2 - 9 1.
Cash Luna, Capital Matias, Capital Noble, Capital Guzman, Capital Old New
2.
126,000 AC P294,000 126,000 P420,000
CC P300,000 120,000 P420,000
Bonus P( 6,000) 6,000 ----
Cash Luna, Capital Matias, Capital Noble, Capital Other Assets Guzman, Capital Old New
3.
120,000 2,000 2,000 2,000
Matias, Capital Guzman, Capital
60,000 20,000 20,000 20,000 60,000 60,000 AC P240,000 60,000 P300,000
CC P300,000 60,000 P360,000
Asset Rev (P60,000) (P60,000) 36,000 36,000
AA 1 - Chapter 2 (2008 edition)
page 13
P120,000 x 30% = P36,000 4.
5.
6.
Luna, Capital Matias, Capital Noble, Capital Cash
80,000 8,000 8,000
Luna, Capital David, Capital
80,000
Luna, Capital Matias, Capital Noble, Capital
80,000
96,000 80,000
40,000 40,000
Problem 2 -10 Canda, Pardo and Andres Statement of Changes in Partners’ Equity For the Period January 1, 2006 to January 1, 2009 Original capital, January 1, 2006 Corrected 2006 net profit Drawings Capital, January 1, 2007 Corrected 2007 net profit Drawings Capital, January 1, 2008 Corrected 2008 net loss Drawings Capital, January 1, 2009
Canda P 62,500 26,375 (15,000) P 73,875 10,875 (15,000) P 69,750 ( 6,750) (10,000) P 53,000
Pardo P 25,000 10,550 ( 7,800) P 27,750 4,350 ( 7,800) P 24,300 ( 2,700) ( 5,200) P 16,400
Andres P 12,500 5,275 ( 5,200) P 12,575 2,175 ( 5,200) P 9,550 ( 1,350) ( 5,200) P 3,000
Total P 100,000 42,200 ( 28,000) P 114,200 17,400 ( 28,000) P 103,600 ( 10,800) ( 20,400) P 72,400
Schedule of computation of corrected net profit Reported net profit (loss) Understatement of accrued expenses Understatement of accrued revenues Overstatement of inventories Understatement of depreciation exp. Corrected net profit (loss) 2.
a.
Revenue Receivable
2006 2007 2008 2006 2007 2008 2006 2007 2008
2006 P 44,000 ( 400 )
2007 P 18,500 400 ( 500 )
2008 P (10,500 ) (
250 ( 1,500 ) ( 150 ) P 42,200
(
250 ) 100
1,500 ( 2,000 ) ( 350 ) P 17,400 150
(
500 650 ) 100 ) 150
2,000 ( 2,000 ) ( 200 ) P (10,800 )
AA 1 - Chapter 2 (2008 edition)
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Canda, Capital Pardo, Capital Andres, Capital Expenses Payable Merchandise Inventory Accumulated Depreciation
2,000 800 400
Canda, Capital (P3,000 x 625/1000) Pardo, Capital (P3,000 x 250/1000) Andres, Capital (P3,000 x 125/1000) Furniture (P4,500 - P1,500)
1,875 750 375
650 2,000 700
3,000
c.
Andres, Capital Furniture Cash Problem 2 -11
2,625 1,500 1,125 Abelar and Berces Statement of Changes in Partners’ Equity For the Period January 1, 2007 to January 15, 2009
Capital balances before closing the books, December 31, 2007 Net profit for 2007 (Sch 1) Drawing Capital, December 31, 2007 Admission of Custodio (Sch. 2) Net loss for 2008 Drawings Capital, December 31, 2008 Loss on realization on Jan. 15, 2009 Final cash distribution
Abelar
Berces
Custodio
Total
P 50,000 6,600 (8,200) P 48,400 (7,800) (5,250) (7,500) P 27,850 (16,520) P 11,330
P 30,000 7,400 (6,800) P 30,600 (5,200) (3,750) (5,000) P 16,650 (11,800)` P 4,850
P 33,000 (6,000) (6,800) P 20,200 (18,880) P 1,320
P 80,000 14,000 (15,000) P 79,000 20,000 (15,000) (19,300) P 64,700 (47,200) P 17,500
Abelar_ P 9,000 (2,400) P 6,600
Berces P 9,000 (1,600) P 7,400
Total P 18,000 ( 4,000) P 14,000
Schedule 1 - Distribution of 2007 net profit Salaries Balance - 60%, 40% Total Schedule 2 - Admission of Custodio Total capital contribution (P79,000 + P20,000) Interest to be credited to Custodio Capital credit of Custodio Capital contribution of Custodio Bonus to Custodio from Abelar and Berces
P 99,000 1/3__ P 33,000 20,000 P 13,000
AA 1 - Chapter 2 (2008 edition)
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MULTIPLE CHOICE 1. 2. 3.
B A B
4.
A
Lima Mitra
5.
A
Asset revaluationP60,000/20% = P300,000 - P150,000 Lima = [P100,000 + (P150,000 x 75%)] x 80% Mitra = [P 50,000 + (P150,000 x 25%)] x 80% Nova
6.
D
P264,000 – [(P278,000 + P418,000 + P192,000) x 1/5] = P86,400 = =
P100,000 x 80% = P80,000 P 50,000 x 80% = P40,000
Original investment Net profit Drawings Capital bal . before transfer to Desta Required capital based on orig. capital ratio after transfer to Desta of 1/4 int. Capital to be transferred to Desta Excess cash to be dist. based on orig. capital ratio (P30,000 - P18,810) Distribution of cash to Felix and Elias 7. 8. 9. 10.
D C C A
11.
C
D A
14.
C
Felix P 24,000 5,430 ( 5,050) P 24,380
Elias P 48,000 10,860 ( 8,000) P 50,860
Total P 72,000 16,290 ( 13,050) P 75,240
18,810 5,570
37,620 P 13,240
56,430 P 18,810
3,730 P 9,300
7,460 P 20,700
11,190 P 30,000
P
P90,000 – P75,000 = P15,000 Capital of Mison prior to admission of Zamora Share in the bonus from Zamora [(P90,000 – P75,000) 1/2) Capital of Mison in the new partnership Voltaire Asuncion Leonor
12. 13.
P150,000 P170,000 P 70,000 P 60,000
AC P180,000 210,000 195,000 P585,000
P105,000 7,500 P112,500 CC P150,000 180,000 195,000 P525,000
P195,000 – (P525,000 x 1/3 = P175,000) = P20,000 Old partners’ capital contribution Percentage of interest of old partners Total agreed capital of the new partnership Percentage of interest of Sison Capital credit of Sison Bonus to Sison Cash to be contributed by Sison Capital balances before adm. of Vidal Asset revaluation (P180,000/20% ) – P840,000 = P60,000
Asset Rev P30,000 30,000 P60,000 P600,000 ÷ 75% P800,000 x 25% P200,000 70,000 P130,000
Rivera P504,000
Sanchez P252,000
Torres P 84,000
36,000
18,000
6,000
AA 1 - Chapter 2 (2008 edition)
page 16
Adjusted capital balances Percentage of unsold interest Capital balances after adm. of Vidal
P540,000 x 80% P432,000
P270,000 x 80% P216,000
P 90,000 x 80% P 72,000
15.
D
Total capital of the new partnership (P840,000/75%) Percentage of interest Amount to be invested by Vidal in the partnership
16.
B
P330,000 315,000 P 15,000
17.
A
Agreed capital Capital contribution = P95,000 + P80,000 + P60,000 + P80,000 = Asset revaluation P80,000 + P12,000 – P70,000 = P22,000
18.
C
Capital balance before admission of Manalo Interest sold to Manalo (P80,000 x 15%) Share in the recorded asset revaluation (P15,000 x 3/10) Share in the bonus from Manalo [(P80,000 + P12,000) - P70,000] x 3/10 Capital balance after admission of Manalo
P 80,000 (12,000) 4,500
19.
B Capital balances, April 30, 2008 1/6 Interest transferred to Magno Balances Cash transfers to equalize investment Balances Distribution of net profit -equally Withdrawals Capital, June 30, 2008
20.
A
21.
A
6,600 P 79,100
Juan P 360,000 ( 60,000) P 300,000 ( 100,000)
Cosme P 225,000 ( 37,500) P 187,500 12,500
Luna P 135,000 ( 22,500) P 112,500 87,500
P 200,000 3,150 ( 1,500) P 201,650
P 200,000 3,150 ( 2,000) P 201,150
P 200,000 3,150 ( 1,500) P 201,650
Agreed capital = (P201,650 + P201,150 + P201,650) ÷ 3/4 = Interest of Magno Required capital credit of Magno Capital balance of Magno before investing cash Cash to be invested by Magno Asset revaluation method: Capital contributions of partners Asset revaluation Additional depreciation Capital balances Bonus method: Capital contributions of partners Bonus to old partners from new partner Capital balances Net advantage of bonus method to Isleta
22.
P1,120,000 x 25% P 280,000
A Capital balance Uncollectible accounts Worthless inventories
Magno P 120,000 P 120,000 P 120,000 3,150 ( 2,000) P121,150
P805,933 1/4___ P201,483 121,150 P 80,333
Galang
Hizon
Isleta
P600,000 252,000 ( 140,000) P712,000
P480,000 168,000 ( 140,000) P508,000
P500,000
P600,000 63,000 P663,000
P480,000 42,000 P522,000
P500,000 ( 105,000) P395,000 P 35,000
Campos P641,976 ( 20,000) ( 5,500)
Centeno P728,352 ( 35,000) ( 6,700)
( 140,000) P360,000
AA 1 - Chapter 2 (2008 edition)
Other assets written off Adjusted capital
page 17
( 2,000) P614,476
( 3,600) P683,052
23.
C
Total capital P614,476 +P683,052 Total liabilities
24.
D
Total capital P1,297,528 / 80% Interest of Coronel Contribution of Coronel
P1,621,910 x 20% P 324,382
25.
D Capital balances Required capital P1,297,528/2 Cash paid (received)
Campos P614,476 648,764 P 34,288
Centeno P683,052 648,764 (P34,288)
Campos P614,476 34,288 130,000 (50,000) P728,764
Centeno P683,052 (34,288) 130,000 (65,000) P713,764
26.
B Capital balances Cash paid (received) Net profit Drawings
27. 28. 29. 30. 31. 32.
C C D D D A
33.
C
65,000 (28,000) P361,382
P4,000 x 2/5 = P1,600 P3,000 / 40% = P7,500 P12,000/3 = P4,000
Retirement of Yumul Capital balance of Ylagan A
Coronel P324,382
The capital balances would be the same as the balances prior to sale of interest.
Interest before retirement Adjustment of assets to FMV
34.
P1,297,528 967,590 P2,265,118
Amount paid to retiring partner Capital of retiring partner Total capital before retirement Total capital after retirement Asset revaluation to retiring partner Fraction of interest of retiring partner Total asset revaluation
Yumul P103,000 12,000 P115,000 (115,000)
Yason P 77,000 12,000 P 89,000 ( 2,000)
Ylagan P180,000 24,000 P204,000 ( 4,000) P200,000 P28,000
P110,000 90,000
20,000 P 8,000 ÷ 2/10 P40,000
AA 1 - Chapter 2 (2008 edition)
page 18
