Banner and Strange are partners who have capital balances of P65,000 and P35,000 and share profits 3:2. Wanda is admitted as a partner and is given a 25% interest in the firm upon investing P40,000 cash. Profits are to be shared 5:3:2 by Banner, Strange and Wanda. Subsequently a new partner, Peter, was admitted by investing P25,000 cash for a 20% interest in assets and a 20% share of the firm's profits. Former partners share the balance of profits in their original ratio. Banner has difficulty getting along with Peter and as a result, Banner withdraws from the partnership. The partnership pays P73,000 cash for Banner's interest.
Banner and Strange are partners who have capital balances of P65,000 and P35,000 and share profits 3:2. Wanda is admitted as a partner and is given a 25% interest in the firm upon investing P40,000 cash. Profits are to be shared 5:3:2 by Banner, Strange and Wanda. Subsequently a new partner, Peter, was admitted by investing P25,000 cash for a 20% interest in assets and a 20% share of the firm's profits. Former partners share the balance of profits in their original ratio. Banner has difficulty getting along with Peter and as a result, Banner withdraws from the partnership. The partnership pays P73,000 cash for Banner's interest.
College Accounting, Chapters 1-27
23rd Edition
ISBN:9781337794756
Author:HEINTZ, James A.
Publisher:HEINTZ, James A.
Chapter19: Accounting For Partnerships
Section: Chapter Questions
Problem 4CE
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10. How much is the capital balances of Wanda after Banner’s withdrawal?
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