13. On January 2, 2016, Abel, Cain, and Josuah formed a partnership. Abel contributed cash of P100,000 and a delivery equipment that originally costs him P 120,000, but with a second hand value of P50,000. Cain contributed P 160,000 in cash. Josuah, whose family sells office equipment, contributed P50,000 in cash and office equipment that cost nis family's dealership P 100,000 but with a regular selling price of P120,000. In 2016, the partnership reported net income of P120,000.On December 31, 2016, what would be the capital balance of the partners? Abel, Cain and Joshuah respectively * O 187,500, 200,000, 212,500 O 190,000, 200,000, 210,000 O 257,500, 200,000, 192,500 O260,000, 200,000, 190,000
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- Claire,Dolly and Ellery formed the CDE Partnership on September 1, 2016, with the following assets, measured at book values in their respective records, contributed by each partner: CLAIRE DOLLY ELLERY Cash 486,000 460,107 231,903 Accounts Receivable 109,620 - 141,000 Property, Plant and Equipment 2,094,390 450,000 - A part of Claire's cash contribution, P324,000, comes from personal borrowings. Also, PPE of Claire and Dolly are mortgaged with the bank for P1,458,000 and P108,000, respectively. The partnership is to assume responsibility for these PPE mortgages. The fair value of the accounts receivable contributed by Ellery is P137,000 while the PPE contributed by Dolly at this date is P510,300. The partners have agreed to share interests on a 5:3:2 ratio, to Claire, Dolly and Ellery, respectively.Claire,Dolly and Ellery formed the CDE Partnership on September 1, 2016, with the following assets, measured at book values in their respective records, contributed by each partner: CLAIRE DOLLY ELLERY Cash 486,000 460,107 231,903 Accounts Receivable 109,620 - 141,000 Property, Plant and Equipment 2,094,390 450,000 - A part of Claire's cash contribution, P324,000, comes from personal borrowings. Also, PPE of Claire and Dolly are mortgaged with the bank for P1,458,000 and P108,000, respectively. The partnership is to assume responsibility for these PPE mortgages. The fair value of the accounts receivable contributed by Ellery is P137,000 while the PPE contributed by Dolly at this date is P510,300. The partners have agreed to share interests on a 5:3:2 ratio, to Claire, Dolly and Ellery, respectively. Required: Use Bonus and Goodwill Method in computing the Capital balances of Claire, Dolly and Ellery.4. During 2014, Taylor and Adele created a partnership to own and operate a minimart by contributing P100,000 each. The partnership agreement provided that Taylor and Adele are to recelve salaries of P100,000 and P50,000, respectively. Remaining profits will be allocated 60:40. Partnership income for 2014 was P130,000, from which Taylor was allocated with an amount of P88,000 and Adele with P42,000. During 2015, the partners agreed to change their profit and loss sharing agreement. The new agreement allows Taylor a salary of P180,000. Adele will no longer receive any salary. The remainder will be split between the partners equally. At the end of 2015, the partnership reported an income of P250,000, However, it was discovered that a counterbalancing error was made by the partnership's accountant last year, resulting to the understatement of 2014's net income by P40,000 and the overstatement of 2015's net income by the same amount. What should be the capital balances of Taylor and Adele…
- Kai and her very close friend Bigan formed a partnership on January 1,2015 with Kain contributing P16,000 cash while Bigan contributing equipment with a book value of P6,400 and a fair value of P4,800 and inventory items with a book value of P2,400 and a fair value of P3,200. During 2015, Bigan made additional investments of P1,600 on April 1 and P1,600 on June 1 and on September 1, he withdrew P4,000. Kai had no additional investments or withdrawals during the year. How much is Bigan's average capital balance?Items 34 and 35 are based on the following information: On January 2,2010, Jason and Melissa formed a partnership by contributing the following assets: Cash Accounts Receivable Merchandise Inventory Land Building Jason P ? 80,000 100,000 Melissa 34. On January 2, 2010, Melissa, Capital amounts to a. P440,000 b. P600,000 P 380,000 240,000 The Land invested by Melissa is subject to mortgage loan of P160,000, which is to be assumed by the partnership. The accounts receivable invested by Jayson are believed to be only 90% collectible. d. P1,040,000 35. Assuming that Jayson is to contribute enough cash to bring his capital equal to that of Melissa, required cash contribution of Jayson is a. P268,000 b. P420,000 d. P600,000 c. P760,000 c. P440,000KATY, a sole proprietor wanted to expand her profitable business but she does not have enough resources. So, she thought of inviting PERRY to join her and formed a partnership on April 1, 2020. Just before admission, KATY had the following assets and liability accounts: Cash - ₱420,000; Accounts receivable -₱380,000; Inventories -₱250,000;Notes payable -₱100,000. PERRY agreed to contribute cash equal to 30% of KATY’s capital after considering the following adjustments: (a) 2% allowance for bad debts should be recognized, (b) the inventories have fair market value equal to 120% of the balance. How much should Perry contribute to the partnership?
- KATY, a sole proprietor wanted to expand her profitable business but she does not have enough resources. So, she thought of inviting PERRY to join her and formed a partnership on April 1, 2020. Just before admission, KATY had the following assets and liability accounts: Cash - ₱420,000; Accounts receivable -₱380,000; Inventories -₱250,000; Notes payable -₱100,000. PERRY agreed to contribute cash equal to 30% of KATY’s capital after considering the following adjustments: (a) 2% allowance for bad debts should be recognized, (b) the inventories have fair market value equal to 120% of the balance. How much is the total assets of the partnership after the formation? *In January 2018, Nick Marasigan and Dems Asacta agreed to purchase and sell chocolate candies. Marasigan contributed P2,400,000 in cash to the business. Asacta contributed the building and equipment, valued at P 2,200,000 and P 1,400,000, respectively. The partnership had profits of P480,000 during 2018 but was less successful during 2019, when profit was only P400,000. Required:1. Prepare the journal entry to record the investment of both partners in the partnership.2. Determine the share of profit for each partner in 2018 and 2019 under each of the following conditions:a. The partners agreed to share profit equally.b. The partners failed to agree on a profit-sharing arrangement.c. The partners agreed to share profit according to the ratio of their original investments.d. The partners agreed to share profits by allowing interest of 10% on their original investments and dividing the remainder equally.e. The partners agreed to share profits by allowing salaries of P400,000 for Marasigan…6.Matthew and Venice decide to form their new retail business as an LLC. Each will receive an equal profits (loss) interest by contributing cash, property, or both. In addition to the members' contributions, their LLC will obtain a $35,000 nonrecourse loan from Simple Bank at the time it is formed. Matthew contributes cash of $4,000 and a building he bought as a storefront for the retail. The building has an FMV of $65,000 and an adjusted basis of $29,000 and is secured by a $34,000 nonrecourse mortgage that the LLC will assume. What is Matthew's outside tax basis in his LLC interest? Show computation.
- Red and Blue formed a joint venture to acquire and sell a special type of merchandise. Red is to manage the venture and to furnish the capital. The participants are to share equally any gain or loss on the joint venture. On April 1, 2022, Blue sent Red P10,000 cash, which was all used to purchase merchandise. On April 27, one half of the merchandise was sold for P7,200 cash. Red paid the cost of delivering merchandise to customers which amounted to P260. No further transactions occurred until the end of the month. The profit (loss) of the venture for the month of April:C, P and A are sole proprietors looking to form a new partnership. C is to contribute cash of P150,000 and his delivery vehicle originally bought at P160,000 but has a second-hand value of P100,000. P is to contribute a cash amounting to P200,000 and furniture worth of P40,000 but was only acquired by P for P36,000. Partner A, whose family business is to sell computers contributed cash of P80,000 and computers and printers with a regular price of P160,000 but with cost of P140,000. CPA Partnership stipulates their P and L ratio to be 3:2:3. What are the capital balances of C, P and A respectively?1. Teddy, Bobbie, Alex, and Gabbie organized a partnership called Four Sisters. Their business is engaged in providing wedding services. Teddy and Bobbie contributed cash of P600,000 each. Alex contributed building which she inherited from her father three (3) years ago. For the transfer tax purposes, the value of the building was P900,000. A week before the partnership was formed, several buyers signify their intention of buying the building for P920,000. The building has been subjected to a mortgage with a carrying amount of P200,000, which will be assumed by the partnership. Gabbie, being an event planner, contributed her skills and knowledge to the partnership. The partners agreed that Gabbie would be given a salary of P15,000. She will also receive 20% of the remaining profits. Questions: a. What is the value of the building contributed by Alex? Justify your answer in no more than three (3) sentences. b. Give the entry to be made at the date of formation. 2. Cyril, Joseph, and…