1. Palatino paid Mallari P 250, 000 for a 50% of his interest. 2. Palatino invested P 250, 000 for a one- fourth interest in the partnership. 3. Palatino invested P 250, 000 for a 30% interest in the partnership.
Partnership Accounting
A partnership is a kind of arrangement between two or more people whereby they agree to manage the business operations and share its profits and losses in an agreed ratio between them. The agreement that is drafted and signed by the partners of the firm is termed as partnership deed and contains various important clauses agreed between the partners such as profit/loss sharing, interest on capital, remuneration allocation of each partner, drawings, admission of a new partner, etc.
Partner Admission and Withdrawal
A partnership is a kind of arrangement between two or more people whereby they agree to manage the business operations and share its profits and losses in an agreed ratio between them. The agreement that is 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, drawings of a partner, etc.
Mallari and Chua are partners who share
following capital balances on Sept. 30, 2020.
Mallari, Capital P 250, 000
Chua, Capital P 500, 000
The partners agreed to admit Palatino to the partnership.
REQUIRED: Calculate the capital balances of each partner after the admission of Palatino, assuming that
bonuses are recorded when appropriate for each of the following assumptions:
1. Palatino paid Mallari P 250, 000 for a 50% of his interest.
2. Palatino invested P 250, 000 for a one- fourth interest in the partnership.
3. Palatino invested P 250, 000 for a 30% interest in the partnership.
4. Palatino invested P 250, 000 for a 20% interest in the partnership.
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