Problem 1At the end of the its first year of operations on December 31, 2020, HEART ATTACK Company'saccounts show the following:CapitalP 48,000P 30,000P 25,000PartnerDrawingsMr. ChicharonP 23,000P 14,000P 10,000Mr. BulaloMr. L. KawaliThe capital balances represents each partner's initial capital investment. Therefore, net incomeor net loss for 2020 has not been closed to the partners' capital accounts.Instructions:a. Journalize the entry to record the division of net income for the year 2020 under each of thefollowing independent assumptions.1. Net income is P 30,000. Income is shared 6:3:12. Net income is P 40,000, Mr. Chicharon and Mr. Bulalo are given salary allowances of P 15,000and P 10,000, respectively. The remainder is shared equally.3. Net income is P 19,000. Each partner is allowed interest of 10% on beginning capitalbalances. Mr. Chicharon is given a P 15,0000 salary allowance. The remainder is shared equallyb. Prepare a schedule showing the division of net income under assumption (3) above.c. Prepare a partner's capital statement for the yar under assumptions (3) above.

Answered: Problem 1 At the end of the its first…

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

Chapter1: Accounting And The Financial Statements

Section: Chapter Questions

Problem 46E: OBJECTIVE 6 Exercise 1-46 Income Statement ERS Inc. maintains and repairs office equipment. ERS had...

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Q R and S carry on business sharing the profits in the ratio of 23: 4 respectively. Capitals as on 1st Jan 2020 are Q is OMR 20.000. Ris OMR 30,000 and Sis OMR 40,000. On 30th Sept 2020 S died due to accident and his executors claim the profit. Calculate Nine months company profit when average profits of the preceding 3 years were Profit 2017 OMR 50,000, Loss 2018 OMR 40.000, and 2019 Profit OMR 30,000? a. 13,333.33 b. None of the options are correct c. 40,000 d. 9999.99
Q. R and 5 carry on business sharing the profits in the ratio of 2: 3: 4 respectively. Capitals as on 1st Jan 2020 are Q is OMR 20,000, Ris OMR 30,000 and Sis OMR 40,000. On 30th Sept 2020 s died due to ill health and his executors claim the profit. Calculate S's Share of profits till the date of death on the basis of average profits of the preceding 3 years were Profit 2017 OMR 50,000 Loss 2018 OMR 40,000 and 2019 Profit OMR 30,000? A. 10,000 b. 17.777.77 c. None of the options are correct d. 4.444.44
Q.no 3. Below are the statements of Financial Position for HP Desk Corporation for 2019 and 2020. HP desk need to raise PKR 500,000 more capital. Should it go for Equity financing from stock market or loan agreement with a bank at a rate of 10%? Compare and Comment on the liquidity and gearing position of the company. Statement of Financial position for HP desk is given below for the period ending Dec 31 2020 (rounding of ‘000). Statement of Financial position for HP desk is given below for the period ending Dec 31 2019(rounding of ‘000).
HW - Ch 20-2 Prepare journal entries to record the effects on Shannon’s accounting records at December 31, 2021, for each of the items described above. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Do not round intermediate calculations. Enter your answers in whole dollars not in thousands of dollars.) (1) Record the gain on sale of investment with an original cost of $186,000 for $232,000 (2) Record the adjustment of equity securities for the investment of $232,000 as on the date of sale. (3) Record the fair value adjustment. (4) Record the loss-lawsuit. (5) Record correction of inventory error. (6) Record correct assets that were incorrectly expensed. (7) Record the 2021 adjusting entry for depreciation. (8) Record the income tax expense.
ln 1/1/2020 the balance of retained earnings is 60 000 lD ., the net income for the year 350 000 lD. , dividends declared on 310 000 lD ., additional depreciation in building 40 000 lD., the retained earnings in 31/12/2020 is :- 410 000 lD . 60 000 lD . 40 000 lD . 100 000 lD . no one.
III. DIRECTION: 1. Prepare the Statement of changes in equity with the accounts given below using your surname as your company name for the period ended December 31, 2019 Capital beginning Additional Investment Drawing Net Profit Capital beginning Additional Investment Drawings (Net Loss) Php150,000.00 Php50,000.00 Php 78,000.00 Php120,000.00 Php 75,000.00 Php25,000.00 Php15,000.00 Php20,000.00)
Question 2Prepare a statement of Profit and Loss Appropriation, capital account, current account for theyear ended 31 December 2020 and extract of statement of financial position at that date, fromthe following:i) Net profit RM30,350ii) Interest to be charged on capital: Wong RM2,000; Pang RM1,500; Halim RM900.iii) Interest to be charged on drawings: Wong RM240; Pang RM180; Halim RM130.iv) Salaries to be credited: Pang RM2,000; Halim RM3,500v) Profit to be shared: Wong 50%; Pang 30%; Halim 20%vi) Current account b/f: Wong RM1,860; Pang RM946; Halim RM717vii) Capital account b/f: Wong RM40,000; Pang RM30,000; Halim RM18,000viii) Drawings: Wong RM 9,200; Pang RM7,100; Halim RM6,900
Question: 1) Calculate the closing capital from the above information: Drawings: $20 000 opening capital: $100 000 Net loss: $50 000. reqiured: please answer this question by calculating the correct closing capital figure from the above information.
Q.1 Khalid and Khamis shared profits in the ratio of 2:3. Their Balance sheet on 31 December 2020 was as follows: Balance Sheet of Khalid and Khamis as on 31st December, 2020 Liabilities Amount(RO) Assets Amount(RO) Bills Payable 40,000 Cash 16,000 Khamis Loan 32,000 Debtors 80,000 (-) Provision for Doubtful Debts(3,600) 76,400 Profit and Loss 50,000 Stock 109,600 Capital Khalid Khamis 240,000 160,000 Computer Equipment 40,000 280,000 522,000 522,000 Khalid and Khamis decided to dissolve the firm on the above date. Debtors Realized for RO 80,000; Stock RO 119,000; Equipment RO 285,000. Computer was taken over by Khalid RO 33,000 Bills Payable were settled at RO 38,000 Cost of Realization expenses RO 2,400 There was a Vehicle in the Firm which was purchased from the Partnership Firm Money was not shown in the books of the firm and sold for RO 10,000. Outstanding Electricity Bill of RO…
Problem #16 Admission by Investment and Division of Profits. The condensed statement of financial position of Matuguinas and Sorima on Dec. 31, 2018, follows: Matuguinas and Sorima Statement of Financial Position December 31, 2017 Assets Current Assets P100,000 Plant Assets (net) 500,000 Total P600,000 Liabilities and Partner's Capital Liabilities P300,000 Matuguinas, Capital 200,000 Sorima, Capital 100,000 Total P600,000 Matuguinas and Sorima shared profits or losses 40% and 60%, respectively. On Jan. 2, 2019, Pateno was admitted to the partnership by investing the net assets of her highly profitable proprietorship. The partners agreed to the following current fair values of the ust identifiable net assets of Pateno's proprietorship: Current Assets P 70,000 Plant Assets 230,000 Total Assets P350,000 Less: Liabilities 200,000 Net Assets P100,000 Pateno's capital account was credited for P120,000. The partners agreed further that the current fair values of the net…
Use the following information for the next three questions:The ledger of COLTISH UNDISCIPLINED Co. in 20x1 includes the following:Jan. 1, 20x1 Dec. 31, 20x1Current assets 1,200,000 ? Noncurrent assets 4,000,000 ? Current liabilities 900,000 1,000,000Noncurrent liabilities ? 3,000,000 Additional information:- COLTISH’s working capital as of December 31, 20x1 is twice as much as the working capital as of January 1, 20x1. - Total equity as of January 1, 20x1 is ₱1,700,000. Profit for the year is ₱2,400,000 while dividends declared amounted to ₱1,000,000. There were no other changes in equity during the year.How much is the total noncurrent liabilities as of January 1, 20x1?a. 2,600,000b. 2,800,000c. 3,200,000d. 3,400,000
Question 7 A list of account balances for “Amara Inc” as at the 30th June 2020 is shown below. Account Name$ Cash18,700 Equipment29,000 Accumulated Depreciation of Equipment14,000 Accounts payable11,200 Capital (1 July, 2019)9,500 Retained Earnings (1 July, 2019)8,200 Dividend Paid25,000 Additional Information: Net Profit after tax for the year ended 30 June 2020 was $29,800 Required:Prepare the Statement of Changes in Owners’ Equity for the year ended 30th June 2020. Click or tap here to enter text. Prepare a fully classified Balance Sheet as at 30th June 2020.

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