Ahmed and Wahid are partners sharing profits and losses in the ratio of 3:1. Their Balance sheet ason March 31, 2021 is as follows.LiabilitiesAmount (RO)AssetsAmount (RO)Creditors315000Cash26250Bills Payable105000Debtors367500General Reserve210000Stock157500Сapital:Plant131250Ahmed420000Buildings525000Wahid210000Profit & Loss Ac52500Bank Overdraft315000 | Equipment315000Total1575000Total1575000On April 01, 2021, they agreed to admit Khalid into the firm for 1/5th Share of future profits onthe following terms:a) Building is revalued at630000b) Stock is revalued at112875c) Goodwill is raised at210000d) Provision for bad debts is to be made at 5%e) Khalid has to bring in a Capital262500f) Khalid was unable to bring the amount of goodwillPass Journal Entries and Prepare Revaluation Account, Capital Accounts and the Balance Sheet of thereconstituted firm.

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Answered: Ahmed and Wahid are partners sharing…

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter15: Partnership Accounting

Section: Chapter Questions

Problem 1PA: The partnership of Tatum and Brook shares profits and losses in a 60:40 ratio respectively after...

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The 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.
Adam and Boru are partners sharing profit and loss in the ratio of 1:1. Their Statement of Financial Position(Balance Sheet) stood as at 31.12.2020 as follows: A and B Partnership Statement of Financial Position As at 31st December 2020 ASSETS 2020 Current Assets Kshs'000 Kshs'000 Cash and Cash Equivalent 43,500 Short Term Deposits - Prepaid Insurance 1,000 Debtors 20,500 Less Provision for Doubtful Debts (1,000) 19,500 Inventories 30,000 94,000 Non Current Assets Machinery 22,000 Less:Accumulated Depreciation - 22,000 Buildings 30,000 Less:Accumulated Depreciation - 30,000…
Chan, Tan and Eric were in partnership sharing profits and losses in the ratio Chan 2/3, Tan 1/4 and Eric 1/12. Their summarized Balance Sheet as at 31 October 2019 was as follows: $$$ $ $ $ $$$ Fixed Assets (at Book Value) Premises 120 000 Machinery 60 000 Motor Vehicle 9 000 189 000 Current Assets Stock 14 200 Debtors 18 000 less Provision for Doubtful Debts 360 17 640 Bank 16 160 48 000 237 000 Capital Accounts Chan…
Chan, Tan and Eric were in partnership sharing profits and losses in the ratio Chan 2/3, Tan 1/4 and Eric 1/12. Their summarized Balance Sheet as at 31 October 2019 was as follows:                                                                         $$$                  $ $ $               $$$ Fixed Assets (at Book Value) Premises                                                                                  120 000 Machinery                                                                               60 000 Motor Vehicle                                                                         9 000               189 000 Current Assets Stock                                                                           14 200 Debtors                                               18 000 less Provision for Doubtful Debts      360                 17 640 Bank                                                                            16 160             48 000 237 000 Capital Accounts Chan…
Chan, Tan and Eric were in partnership sharing profits and losses in the ratio Chan 2/3, Tan 1/4 and Eric 1/12. Their summarized Balance Sheet as at 31 October 2019 was as follows:                                                                         $$$                  $ $ $               $$$ Fixed Assets (at Book Value) Premises                                                                                  120 000 Machinery                                                                               60 000 Motor Vehicle                                                                         9 000               189 000 Current Assets Stock                                                                           14 200 Debtors                                               18 000 less Provision for Doubtful Debts      360                 17 640 Bank                                                                            16 160             48 000 237 000 Capital Accounts Chan…
Chan, Tan and Eric were in partnership sharing profits and losses in the ratio Chan 2/3, Tan 1/4 and Eric 1/12. Their summarized Balance Sheet as at 31 October 2019 was as follows:                                                                         $$$                  $ $ $               $$$ Fixed Assets (at Book Value) Premises                                                                                  120 000 Machinery                                                                               60 000 Motor Vehicle                                                                         9 000               189 000 Current Assets Stock                                                                           14 200 Debtors                                               18 000 less Provision for Doubtful Debts      360                 17 640 Bank                                                                            16 160             48 000 237 000 Capital Accounts…
Chan, Tan and Eric were in partnership sharing profits and losses in the ratio Chan 2/3, Tan 1/4 and Eric 1/12. Their summarized Balance Sheet as at 31 October 2019 was as follows: $$$ $ $ $ $$$ Fixed Assets (at Book Value) Premises 120 000 Machinery 60 000 Motor Vehicle 9 000 189 000 Current Assets Stock 14 200 Debtors 18 000 less Provision for Doubtful Debts 360 17 640 Bank 16 160 48 000 237 000 Capital Accounts…
Dasal, Kho, Papasa, and Akho are partners sharing earnings in the ratio of 4:5:4:7. The balance of their capital accounts on December 31, 2019 are as follows: Dasal, P4,000; Kho, P20,000; Papasa, P20,000; and Akho, P8,000. The partners decided to liquidate, and they accordingly convert all non-cash assets into P24,000 cash. After paying the liabilities amounting toP4,000, they have P22,000 to divide. Assume that a debit balance in any partner's capital is uncollectible. How much did Kho receive in the final distribution ofcash?
The December 31, 2020 Statement of Financial Position of the Alyza, Angiela, and Pamela Partnership is summarized as follows:Cash P100,000 Angiela, Loan P100,00Other assets, at cost 500,000 Alyza, Capital 100,00Angiela, Capital 200,000Pamela, Capital 200,000P600,000 P600,000The partners share profits and losses as follows: Alyza, 20%; Angiela, 30%; and Pamela, 50%, Angiela is retiring from the partnership and the partners have agreed that “other assets” should be adjusted to their fair value of P600,000 at December 31, 2020. They further agreed that Angiela will receive P244,000 cash for his partnership interest exclusive of the loan, which is to be paid in full. No goodwill implied by Angiela’s payment will be recorded:After Pamela’s retirement, the capital balances of Alyza and Pamela, respectively, will be:a. P116,000 and P240,000 c. P100,000 and P200,000b. P101,714 and P254,286 d. P73,143 and P182,857
On January 02, 2019, the business assets and liabilities of Gail Anne & Precious were as follows: Gail AnnePrecious CashP28,000P62,000 Receivables 200,000 600,000 Inventories 120,000 200,000 PPE 650,000 535,000 Other Assets 2,000 3,000 Accounts Payable 180,000 250,000 Notes Payable 200,000 350,000 Gail Anne and Precious agreed to form a partnership by contributing their net assets subject to the following adjustments: ➢ Receivables of P20,000 in Gail Anne’s books and P40,000 in Precious’ books are uncollectible ➢ Inventories of P6,000 and P7,000 in the respective books of Gail Anne and Precious are worthless ➢ Other assets in both books are to be written off ➢ Accrued interest on notes payable equal to 10% is to be established. The note payable of Gail Anne was dated August 01, 2018 while that of Precious, was dated April 01, 2018. The balances of selected accounts after the formation are: Assets…
On September 2, 2020, Nino, Olan, and Pete formed a partnership investing cash of P945,000,P850,000, and P264,600. The partners share profits and losses in the ratio of 3:2:2 and on October 31,2020the firm has cash of P63,000, other assets of P2,992,500, and liabilities of P1,612,800. On this date theydecided to go out of busines and sell all the assets for P1,890,000. Pete has personal assets of P94,500thatmay, if necessary, be used to meet partnership obligations. Loss from operations was P617,400. Howmuchshould be distributed to Olan upon liquidation of the partnership? a. P128,520b. P306,180c. P0d. P268,380
On the December 31, 2020, the Statement of Financial Position of LOVE Partnership shows the following data with profit or loss sharing of 5:3:2.CashP10,000,000Noncash Asset40,000,000Total LiabilitiesP20,000,000Ona10,000,000Vina15,000,000Ena5,000,000On January 01, 2021, Lina is admitted to the new partnership named LOVE by investing P20,000,000 for 50% capital interest in the new partnership. What is the new capital balance of Ena after Lina’s admission in LOVE Partnership?

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