One or more sole proprietors and one or more individuals without eXisting business form a partnership. 1. On July 1, 20xx, Julius invited Ceazar to join him in his retail business. Julius to contribute all his assets and liabilities in the business and Ceazar to contribute cash equivalent to the net worth of Julius. Julius and Ceazar agreéd to divide profits and losses equally. The statement of financial position of Julius on June 30, 20xx follows: Julius Enterprises Statement of Financial Position As at June 30, 20xx Assets Cash P 555,000 Accounts Receivable P150,000 Less: Allow.for Uncollectible Accounts 5,000 Inventory Vehicles 145,000 2,000,000 500,000 Less: Accumulated Depreciation 100,000 400,000 Total Assets P3,100,000 Liabilities and Capital Accounts Payable Julius Capital Total Liabilities and Capital P 300,000 2,800.000 P3,100,000

One or more sole proprietors and one or more individuals without eXisting business form a partnership. 1. On July 1, 20xx, Julius invited Ceazar to join him in his retail business. Julius to contribute all his assets and liabilities in the business and Ceazar to contribute cash equivalent to the net worth of Julius. Julius and Ceazar agreéd to divide profits and losses equally. The statement of financial position of Julius on June 30, 20xx follows: Julius Enterprises Statement of Financial Position As at June 30, 20xx Assets Cash P 555,000 Accounts Receivable P150,000 Less: Allow.for Uncollectible Accounts 5,000 Inventory Vehicles 145,000 2,000,000 500,000 Less: Accumulated Depreciation 100,000 400,000 Total Assets P3,100,000 Liabilities and Capital Accounts Payable Julius Capital Total Liabilities and Capital P 300,000 2,800.000 P3,100,000

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter15: Partnership Accounting

Section: Chapter Questions

Problem 1PB: The partnership of Magda and Sue shares profits and losses in a 50:50 ratio after Mary receives a...

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The partnership of Magda and Sue shares profits and losses in a 50:50 ratio after Mary receives a $7,000 salary and Sue receives a $6,500 salary. Prepare a schedule showing how the profit and loss should be divided, assuming the profit or loss for the year is: A. $10,000 B. $5,000 C. ($12,000) In addition, show the resulting entries to each partners capital account.
Two sole proprietors L and M agreed to form a partnership on January 31, 20x4. The trial balance for each proprietor is shown below as of January 1, 20x4 L Cash Account receivable, net Merchandise inventory Building, net Furniture and fixtures, net Accounts payable Mortgage payable BOOK VALUE L, Capital M, Capital L FAIR VALUE 40,000.00 52,000.00 M BOOK VALUE M 40,000.00 60,000.00 100,000.00 94,000.00 100,000.00 114,000.00 280,000.00 320,000.00 250,000.00 280,000.00 60,000.00 64,000.00 40,000.00 44,000.00 110,000.00 110,000.00 200,000.00 200,000.00 230,000.00 80,000.00 80.000.00 150,000.00 150,000.00 260,000.00 The L and M partnership will take over the assets an assume the liabilities of the proprietors as of January 1, 20x4 FAIR VALUE 30,000.00 30,000.00 70,000.00 56,000.00 REQUIRED: A. Determine the following items after formation of the partnership. (1) Total assets, (2) Total liabilities, and (3) Total capital
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