Exercise3: Retirement of a Partner G, H and I are partners whose capital balances as of January 1, 2019 are in the same proportion as their share in profit of 20:30:50. As of January 1, 2019, total partnership assets amount to P150,000 with the liabilities at P60,000. Their additional investments and withdrawals for 2019 are as follows: Additional Drawing P9,000 Investments G P15,000 18,000 12,000 H retires as of December 1, 2019, G and l agreed to a settlement for his share in equity plus 10% thereof after three months. Pending settlement, the amount due to H shall bear an H 10,000 interest of 12%. The partnership net income for 2019, prior to the above-mentioned interest, amounts to P32,400. Instructions: a. Determine the amount due to H as of December 31, 2019. b. Make the entries incidental to the retirement of H under each of the following assumptions: 1. The additional consideration is to be treated as a bonus from the remaining partners. 2. The additional consideration of 10% is H's share in asset revaluation:

Exercise3: Retirement of a Partner G, H and I are partners whose capital balances as of January 1, 2019 are in the same proportion as their share in profit of 20:30:50. As of January 1, 2019, total partnership assets amount to P150,000 with the liabilities at P60,000. Their additional investments and withdrawals for 2019 are as follows: Additional Drawing P9,000 Investments G P15,000 18,000 12,000 H retires as of December 1, 2019, G and l agreed to a settlement for his share in equity plus 10% thereof after three months. Pending settlement, the amount due to H shall bear an H 10,000 interest of 12%. The partnership net income for 2019, prior to the above-mentioned interest, amounts to P32,400. Instructions: a. Determine the amount due to H as of December 31, 2019. b. Make the entries incidental to the retirement of H under each of the following assumptions: 1. The additional consideration is to be treated as a bonus from the remaining partners. 2. The additional consideration of 10% is H's share in asset revaluation:

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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