23. Partner X contributed equipment to the XYZ partnership. The equipment cost, P60,000 with accumulated depreciation of P10,000 but had a fair value of P70,000 at the date the partnership received it. At what amount should the equipment be reported? O a P70,000 O b. P60,000 O c. P10,000 O d. P50,000

23. Partner X contributed equipment to the XYZ partnership. The equipment cost, P60,000 with accumulated depreciation of P10,000 but had a fair value of P70,000 at the date the partnership received it. At what amount should the equipment be reported? O a P70,000 O b. P60,000 O c. P10,000 O d. P50,000

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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Problem #1. Partner'Original Investment Froilan Labausa contributed land, inventory, and P280,000 cash to partnership.The land has a book value of P650,000 and a market value P1,350,000.The inventory has a book value of P600,000 and a market value of P510,000.The partnership also assumed a P350,000 a note payable owed by Labausa that was used to purchase the land.Rosalie Balhag to put up cash equivalent to Labausa's net investment. Required: Prepare a journal entry to report Labausa's and Balhag's investment in the partnership.
Mighty Darrel and Super Zigg formed a partnership and agreed to have an equal interest in thepartnership’s assets. They agreed to make the following contributions : Darrel contributed 100,000and Zigg contributed 84,000 in identifiable assets. Under the bonus approach, what is the amount ofbonus from Darrel to Zigg capital? A. 46,000B. 16,000C. 8,000D. 0
The following items are being invested by A and B to form AB Partnership Agreed Cash Inventory Land Building Equipment Total Mortgage on building assumed by the partnership Investment by A 120,000.00 120,000.00 240,000.00 480,000.00 480.000.00 Values Investment by B 120,000.00 240,000.00 480,000.00 840,000.00 240,000.00 600.000.00 REQUIRED: A. Prepare entries to record the formation of partnership assuming that A and B agree that each partner is to receive a capital credit equal to the agreed values of the net assets each partner invested. B. Prepare entities to record the formation of the partnership assuming that A and B agreed that each partner is to receive an equal capital investment.
5. Assume that a partnership had assets with a book value of P240,000 and a market value of P195,000, outside liabilities of P70,000, loans payable to partner Able of P20,000, and capital balances for partners Able, Baker, and Chapman of P70,000, P30,000, and P50,000. How much would Able receive upon liquidation of the partnership assuming profits and losses are allocated equally? a. P70,000 b. P90,000 C. P75,000 d. P55,000
4. X, Y, and Z have capital balances of P40,000.00, P50,000.00, and P18,000.00 and a profit – sharing ratio 4:2:1, respectively. If X received P8,000.00 upon liquidation of the partnership, the total amount received by partner Z was: a. P10,000.00 b. P 8,000.00 c. P34,000.00 d. P -0- 5. Assume the same facts in No. 4, above, except that X received P26,000.00 as a result of the liquidation. The total gain/loss on realization amounted to: a. P 3,500.00 b. P14,000.00 c. P 7,000.00 d. P24,500.00
X, Y and Z decided to form XYZ Partnership. It was agreed that X will contribute an equipment with assessed value of P300,000 with historical cost of P800,000 and accumulated depreciation of P500,000. On the date of formation, the fair value of equipment was P 400,000. Y will contribute a land and building with carrying amount of P1,200,000 and fair value of P1,500,000. The land and building are subject to a mortgage payable amounting to P300,000 to be assumed by the partnership. The partners agreed that Y will have 40% capital interest in the partnership. The partners also agreed that Z will contribute sufficient cash to the partnership. Net income for the year is P400,000. How much profit should be allocated to X? a) 1,250,000 b) 1,175,000 c) 1,050,000 d) 1,800,000
A and B formed a partnership. A contributed cash of P50,000 and equipment with a cost of P40,000, accumulated depreciation of P15,000 and fair value of P30,000. The partnership assumed a liability associated to the equipment amounting to P10,000. How much should be credited to A, Capital account?
X and Y are partners with capital account balances of P 600,000 each and share profits and loss equally Z is allowed to purchase of the interest of X by paying P 200,000. The partners further agreed to record asset revaluation before the admission of Z. By how much would the new partnership net assets change as the result of asset revaluation? Place a parenthesis if your answer is decrease
Numbers 1-4 (Investment Method Vs. Bonus Method) Thor and Loki formed a partnership and contributed the following assets with their respective fair values: Loki Cash Land Building Equipment B. 420,000 C. 300,000 D. 432,000 Thor P 180,000 Per partnership agreement, the equipment is to be valued at P120,000. Loki's land and building is subject to a P100,000 real estate mortgage which is assumed by the partnership. The mortgage has P10,000 interest accrued which is to be assumed by Loki. The fair value of the land and building is agreed to be equal to their respective book values. 100,000 1. How much is the final capital credit to Thor? A. 288,000 B. 420,000 C. 300,000 D. 432,000 2. How much is the final capital credit to Loki? A. 288,000 P220,000 300,000 Assuming instead that Thor and Lokd decided to divide capital in the ratio of 40:60, respectively and uses the bonus method, answer the following: B. 420,000 C. 300,000 D. 432,000 3. How much is the final capital credit to Thor? A.…
A and B enter into a partnership agreement in which B contributes the following: Non-cash Assets Land Building Machinery and Equipment Cost P 100,000 1,000,000 500,000 Comments Cost is equal to the fair value Fair value of which is 80% of its cost Fair value of which is 70% of its cost There is a P200,000 mortgage on the building which the partners agree not to assume in the partnership. A contributes cash of P650,000. Compute the total assets of the partnership upon formation.
1. What is the capital of Jack and Jill after the above adjustments? Jack Jill Jack JillA. 650,000 ; 760,000 C. 687,500 ; 772,500B. 650,000 ; 810,000 D. 750,000 ; 810,000 2. What is the total assets of the partnership after the formation?A. 1,460,000 C. 1,895,000B. 1,855,000 D. 2,000,000
A, B, C and E are partners. They contributed to the capital as follows: A-P50,000; B-P100,000; C-P150,000; and E as the industrial partner, his services. The partnership obligation to outsiders exceeds the total net assets by P200,000. Who and by how much will the partners be liable for the payment of the P200,000? a. A-zero; B- zero; C-zero; E-zero b. A- P33,333; B-P66,666;C-P100,000;E-zero c. A-P45,000; B-P45,000; C-P55,000; E- P55,000 d. A-P50,000; B-P50,000; C-P50,500; E-P50,000