A, B, and C are partners sharing profits and losses in a 5:3:2 ratio. They have capital balances of P500,000; P300,000 and P200,000 respectively. B retires and receives only P240,000 from the partnership as it is deemed that firm's equipment is under depreciated. What is the capital balance of A after B's withdrawal?

The partnership comes into existence when two or more persons agree to do the business and further…

Answered: , B, and C are partners sharing profits…

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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A, B, and C are partners sharing profits and losses in a 5:3:2 ratio. They have capital balances of P500,000; P300,000 and P200,000 respectively. B retires and receives only P240,000 from the partnership as it is deemed that firm's equipment is under depreciated. What is the capital balance of A after B's withdrawal?

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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