(Cash, Non-cash and Net Assets Contributions) The partnership of Abueva and Alano was formed on June 1, 2014, when they agreed to invest equal amount of capital into the firm. The investment by Abueva consists of PS18,000 cash and an inventory of merchandise valued at P1,152,000. Alano agreed to contribute the assets of his business along with the transfer to the partnership of his business liabilities. Alano was credited for goodwill for the excess of the capital credit over the agreed value of his net assets. The assets and liabilities are shown on the next Balances on Alano's Records Agreed Value P 1,792,000 76,800 192,000 256,000 576,000 P 1,792,000 150,000 253,000 206,000 Accounts Receivable Allow. For Uncollectible Accounts Inventory Office Equipment (net) Accounts Payable 576,000 Instructions: 1. Give the entries to record the investments of Abueva and Alano in the new partnership. Prepare the beginning statement of financial position of the partnership, reflecting the above transfers to the firm. 2.
(Cash, Non-cash and Net Assets Contributions) The partnership of Abueva and Alano was formed on June 1, 2014, when they agreed to invest equal amount of capital into the firm. The investment by Abueva consists of PS18,000 cash and an inventory of merchandise valued at P1,152,000. Alano agreed to contribute the assets of his business along with the transfer to the partnership of his business liabilities. Alano was credited for goodwill for the excess of the capital credit over the agreed value of his net assets. The assets and liabilities are shown on the next Balances on Alano's Records Agreed Value P 1,792,000 76,800 192,000 256,000 576,000 P 1,792,000 150,000 253,000 206,000 Accounts Receivable Allow. For Uncollectible Accounts Inventory Office Equipment (net) Accounts Payable 576,000 Instructions: 1. Give the entries to record the investments of Abueva and Alano in the new partnership. Prepare the beginning statement of financial position of the partnership, reflecting the above transfers to the firm. 2.
Chapter11: Partnerships: Distributions, Transfer Of Interests, And Terminations
Section: Chapter Questions
Problem 47P
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Question
Transcribed Image Text:(Cash, Non-cash and Net Assets Contributions)
The partnership of Abueva and Alano was formed on June 1, 2014, when they agreed to
invest equal amount of capital into the firm. The investment by Abueva consists of
P518,000 cash and an inventory of merchandise valued at P1,152,000. Alano agreed to
contribute the assets of his business along with the transfer to the partnership of his
business liabilities. Alano was credited for goodwill for the excess of the capital credit
over the agreed value of his net assets.
The assets and liabilities are shown on the next
Balances on
Agreed
Value
Alano's
Records
P 1,792,000
76,800
192,000
256,000
P 1,792,000
150,000
253,000
206,000
576,000
Accounts Receivable
Allow. For Uncollectible Accounts
Inventory
Office Equipment (net)
Accounts Payable
576,000
Instructions:
1.
Give the entries to record the investments of Abueva and Alano in the new
partnership.
2.
Prepare the beginning statement of financial position of the partnership, reflecting
the above transfers to the firm.
Transcribed Image Text:(Two Sole Proprietors Form a Partnership; New Books are to be opened
for the Partnership)
Partners Abada and Albano agreed to combine their businesses into a partnership. The
statement of financial position accounts of Abada and Albano are shown below.
ABADA
Вook
ALBANO
Book
Agreed
Value
P 50,000 P 70,000 P 70,000
460,000
Agreed
Value
Value
P 50,000
460,000
30,000
Value
Cash
Accounts Receivable
Allowance for Uncollectible
490,000
490,000
40,000
40,000
50,000
Accounts
Merchandise Inventory
Equipment
Accumulated Depreciation
Furniture and Fixtures
Accumulated Depreciation
Accounts Payable
900,000
180,000
36,000
120,000
950,000
120,000
720,000
90,000
9,000
700,000
70,000
90,000
24,000
540,000
540,000
360,000
360,000
Instructions: Give the journal entries to record the partnership formation under each of the
following independent assumptions:
1.
A new set of books are to be opened for the partnership
2.
The books of Abada are to be used by the partnership
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