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1. Triangle, Square and Round formed a partnership. Triangle contributed cash of P80,000. Square contributed equipment with historical cost of P700,000, carrying amount of P180,000, and fair value of P90,000. Round contributed building with historical cost of P1,000,000, carrying amount of P480,000 and fair value of P690,000. The partnership will assume the unpaid mortgage of P580,000 on the building. Which partner has the least capital account balance on partnership formation? a. Triangle b. Square c. Round d. None, all are equal

1. Triangle, Square and Round formed a partnership. Triangle contributed cash of P80,000. Square contributed equipment with historical cost of P700,000, carrying amount of P180,000, and fair value of P90,000. Round contributed building with historical cost of P1,000,000, carrying amount of P480,000 and fair value of P690,000. The partnership will assume the unpaid mortgage of P580,000 on the building. Which partner has the least capital account balance on partnership formation? a. Triangle b. Square c. Round d. None, all are equal

SWFT Individual Income Taxes
SWFT Individual Income Taxes
43rd Edition
ISBN:9780357391365
Author:YOUNG
Publisher:YOUNG
Chapter20: Corporations And Parterships
Section: Chapter Questions
Problem 5BCRQ
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PARTNERSHIP FORMATION
1. Triangle, Square and Round formed a partnership. Triangle contributed cash of P80,000. Square contributed equipment with historical cost of P700,000, carrying amount of P180,000, and fair value of P90,000. Round contributed building with historical cost of P1,000,000, carrying amount of P480,000 and fair value of P690,000. The partnership will assume the unpaid mortgage of P580,000 on the building. Which partner has the least capital account balance on partnership formation? a. Triangle b. Square c. Round d. None, all are equal
Transcribed Image Text:1. Triangle, Square and Round formed a partnership. Triangle contributed cash of P80,000. Square contributed equipment with historical cost of P700,000, carrying amount of P180,000, and fair value of P90,000. Round contributed building with historical cost of P1,000,000, carrying amount of P480,000 and fair value of P690,000. The partnership will assume the unpaid mortgage of P580,000 on the building. Which partner has the least capital account balance on partnership formation? a. Triangle b. Square c. Round d. None, all are equal
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