FUND.ACCT.PRIN.
25th Edition
ISBN: 9781260247985
Author: Wild
Publisher: RENT MCG
expand_more
expand_more
format_list_bulleted
Question
Chapter 12, Problem 11QS
To determine
Introduction:
To Prepare: The journal entry of Partner withdrawal.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
Problem #5
Withdrawal of a Partner
On July 10, 2019, Partner Ibrahim decided to withdraw from Cebedo, Basa, and Ibrahim Partnership. Their profit and loss ratio is 3:2:1, respectively. Partnership assets are to be used to acquire Ibrahim’s partnership interest. The statement of financial position for the partnership on that date follows:
Cebedo, Basa and Ibrahim
Statement of Financial Position
July 10, 2019
AssetsCash - P 74,000Trade Accounts Receivable (net)- 36,000Plants Assets (net)- 135,000Goodwill (net)- 30,000Total Assets- P275,000Liabilities and Partners' CapitalLiabilities-P 45,000Cebedo, Capital- 120,000Basa, Capital- 60,000Ibrahim, Capital- 50,000Total Liabilities and Partners' Capital-P275,000
Required:
Prepare the journal entries to record Ibrahim’s withdrawal under each of the following assumptions:
Ibrahim is paid P54,000, and the excess amount paid over Ibrahim’s capital account balance is recorded as a bonus to Ibrahim from Cebedo and Basa.
Ibrahim is paid…
Withdrawal of a Partner
On July 10, 2019, Partner Ibrahim decided to withdraw from Cebedo, Basa and Ibrahim Partnership. Their profit and loss ratio is 3:2:1, respectively. Partnership assets are to be used to acquire Ibrahim’s partnership interest. The statement of financial position for the partnership on that date follows:
Cebedo, Basa and Ibrahim
Statement of Financial Position
July 10, 2019
Assets Liabilities and Partner’s Capital
Cash P 74,000 Liabilities P 45,000
Trade Accounts Receivable (net) 36,000 Cebedo, Capital 120,000
Plants Assets (net) 135,000 Basa, Capital…
Question 1
• Rachael and Olivia are business partners in RO Dance Their partnership agreement states that the
partners will share income in a 3:1 ratio (Rachael, Olivia). Part of the agreement includes a salary
allowance of $43,000 for Rachael and $26,000 for Olivia. For the current year. RO Dance has a net loss
of $5,000. The entries to close the income summary account after allocating the loss to the partners
include
• a debit to Rachael, Capital $12,500 and a credit to Olivia, Capital $7,500
a credit to Rachael, Capital $12,500 and a debit to Olivia, Capital $7,500
•
a debit to Rachael, Capital $12,500 and a debit to Olivia, Capital $7,500
• a credit to Rachael, Capital $12,500 and a credit to Olivia, Capital $7,500
None of these choices are correct
Chapter 12 Solutions
FUND.ACCT.PRIN.
Ch. 12 - Prob. 1QSCh. 12 - Prob. 2QSCh. 12 - Prob. 3QSCh. 12 - Prob. 4QSCh. 12 - Prob. 5QSCh. 12 - Prob. 6QSCh. 12 - Prob. 7QSCh. 12 - Prob. 8QSCh. 12 - QS 12-9
Liquidation of partnership
P5
The Field,...Ch. 12 - Prob. 10QS
Ch. 12 - Prob. 11QSCh. 12 - Prob. 12QSCh. 12 - Prob. 13QSCh. 12 - Prob. 14QSCh. 12 - Prob. 1ECh. 12 - Prob. 2ECh. 12 - Prob. 3ECh. 12 - Prob. 4ECh. 12 - Prob. 5ECh. 12 - Prob. 6ECh. 12 - Prob. 7ECh. 12 - Prob. 8ECh. 12 - Prob. 9ECh. 12 - Prob. 10ECh. 12 - Prob. 11ECh. 12 - Prob. 12ECh. 12 - Prob. 13ECh. 12 - Prob. 14ECh. 12 - Prob. 15ECh. 12 - Prob. 1PSACh. 12 - Prob. 2PSACh. 12 - Prob. 3PSACh. 12 - Prob. 4PSACh. 12 - Prob. 5PSACh. 12 - Prob. 6PSACh. 12 - Prob. 1PSBCh. 12 - Prob. 2PSBCh. 12 - Prob. 3PSBCh. 12 - Prob. 4PSBCh. 12 - Prob. 5PSBCh. 12 - Prob. 6PSBCh. 12 - Prob. 12SPCh. 12 - Prob. 1AACh. 12 - Prob. 2AACh. 12 - Prob. 3AACh. 12 - Prob. 1DQCh. 12 - Prob. 2DQCh. 12 - Prob. 3DQCh. 12 - Prob. 4DQCh. 12 - Prob. 5DQCh. 12 - Prob. 6DQCh. 12 - Prob. 7DQCh. 12 - Prob. 8DQCh. 12 - Prob. 9DQCh. 12 - Kay, Kat, and Kim are partners. In a liquidation,...Ch. 12 - Prob. 11DQCh. 12 - Prob. 12DQCh. 12 - Prob. 1BTNCh. 12 -
BTN 12-4 Assume that you are studying for an...Ch. 12 - BTN 12-3 Access the 2017 10-K of Advanced...Ch. 12 - Prob. 4BTN
Knowledge Booster
Similar questions
- 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.arrow_forwardThe partnership of Chase and Chloe shares profits and losses in a 70:30 ratio respectively after Chloe receives a $10,000 salary. Prepare a schedule showing how the profit and loss should be divided, assuming the profit or loss for the year is: A. $ 30,000 B. $ 6,000 C. ($10,000)arrow_forwardThe partnership of Tatum and Brook shares profits and losses in a 60:40 ratio respectively after Tatum receives a 10,000 salary and Brook receives a 15,000 salary. Prepare a schedule showing how the profit and loss should be divided, assuming the profit or loss for the year is: A. $40,000 B. $25,000 C. ($5,000) In addition, show the resulting entries to each partners capital account. Tatums capital account balance is $50,000 and Brooks is $60,000.arrow_forward
- Problem #5 Withdrawal of a Partner On July 10, 2019, Partner Ibrahim decided to withdraw from Cebedo, Basa and Ibrahim Partnership. Their profit and loss ratio is 3:2:1, respectively. Partnership assets are to be used to acquire Ibrahim's partnership interest. The statement of financial position for the partnership on that date follows: Cebedo, Basa and Ibrahim Statement of Financial Position July 10, 2019 Assets Cash Trade Accounts Receivable (net) Plants Assets (net) Goodwill (net) Total P 74,000 36,000 135,000 30,000 P275,000 Liabilities and Partner's Capital Liabilities Cebedo, Capital Basa, Capital Ibrahim, Capital Total P 45,000 120,000 60,000 50,000 P275,000 Required: Prepare the journal entries to record Ibrahim's withdrawal under each of the following assumptions: 1. Ibrahim is paid P54,000, and the excess amount paid over Ibrahim's capital account balance is recorded as a bonus to Ibrahim from Cebedo and Basa. 2. Ibrahim is paid P45,000, and the difference is recorded as a…arrow_forwardNoor, Tala and Sara are three partners on 31/12/2019 the capital balances are 10,000, 15,000 and 20,000 respectively on the same date Sara decide to withdraws from partnership, the company paid her $ 18,000 the debit side of journal entry is: Select one: a. cash 20,000 b. sara capital 18,000 c. cash 18,000 d. sara capital 20,000arrow_forwardChapter 16 4. The partnership of Xavier, Yarnell and Zablicki have decided to liquidate their partnership. At the time, the partners share income and loss in the ratio of 2:2:6. No partner can make any payments into the partnership. The partnership sold the noncash assets for $20,000. A. Complete the liquidation schedule below Marshalling of Assets - Simple Liquidation Noncash Y, Beginning balances Sell noncash assets Pay creditors Offset loan Allocated deficit Beginning balances Sell noncash assets Pay creditors Payment to partners B. Now assume the noncash assets were sold for $16,000. Complete the liquidation schedule below Marshalling of Assets - Simple Liquidation Offset loan Allocated deficit Cash Assets Liabilities $5,000 $40,000 $15,000 Payment to partners Cash $5,000 Noncash Assets $40,000 X Y, Loan Capital Capital $2,000 $12,000 $1,000 Liabilities $15,000 Y, Loan X₂ Capital $2,000 $12,000 Y, Capital Z₂ Capital $15,000 $1,000 Z, Capital $15,000arrow_forward
- Withdrawal of a Partner Gregorio is retiring from the partnership of Guerra, Guillermo, and Gregorio. The profit and loss ratio is 2:2:1, respectively. After the accountant has posted the revaluation and closing entries, the credit balances in the Capital accounts are: Guerra, P530,000; Guillermo, P430,000; and Gregorio, P210,000. Required: Journalize the journal entries to record the retirement of Gregorio under each of the following unrelated assumptions: Gregorio retires, talking P210,000 of partnership cash for her equity. Gregorio retires, talking P270,000 of partnership cash for her equity.arrow_forwardRetirement -Sale of interest to continuing partner Long-term partners, A, B, and C have capital balances of P60,000, P45,000, and P30,000, respectively. They share in profits and losses 5:3:2, respectively. All assets are valued fairly. C decides to retire from the partnership. C sells the interest to B for P25,000. Calculate B's capital balance after C withdrawal.arrow_forwardSCO PROFESSOR: NAME: SECTION: Problem #20 Withdrawal of a Partner position for the partnership on that date follows: Cebedo, Basa and Ibrahim Statement of Financial Position July 10, 2019 Liabilities and Partners' Capital 骨 Assets P 74,000 36,000 135,000 30,000 P275,000 Liabilities P 45,000 120,000 Cash Trade Accounts Receivable (net) Plant Assets (net) Goodwill (net) Cebedo, Capital Basa, Capital Ibrahim, Capital 60,000 50,000 P275,000 Total Total Required: Prepare the journal entries to record Ibrahim's withdrawal under each of the following assumptions: 1. Ibrahim is paid P54,000, and the excess amount paid over Ibrahim's capital account balance is recorded as a bonus to Ibrahim from Cebedo and Basa. 2. Ibrahim is paid P45,000, and the difference is recorded as a bonus to Cebedo and Basa from Ibrahim. * 1oranim accepted cash of P40,500 and plant assets (equipment) with a current fair value of P9,000. The equipment had cost P30.000 and was 60% depreciated, with sidual value (Record…arrow_forward
arrow_back_ios
arrow_forward_ios
Recommended textbooks for you
Principles of Accounting Volume 1AccountingISBN:9781947172685Author:OpenStaxPublisher:OpenStax College- Century 21 Accounting Multicolumn JournalAccountingISBN:9781337679503Author:GilbertsonPublisher:Cengage
College Accounting, Chapters 1-27AccountingISBN:9781337794756Author:HEINTZ, James A.Publisher:Cengage Learning,
Principles of Accounting Volume 1
Accounting
ISBN:9781947172685
Author:OpenStax
Publisher:OpenStax College
Century 21 Accounting Multicolumn Journal
Accounting
ISBN:9781337679503
Author:Gilbertson
Publisher:Cengage
College Accounting, Chapters 1-27
Accounting
ISBN:9781337794756
Author:HEINTZ, James A.
Publisher:Cengage Learning,