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Chapter10: Partnerships: Formation, Operation, And Basis
Section: Chapter Questions
Problem 59P
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Transcribed Image Text:The following condensed statement of financial position is presented for the partnership
of Morales, Gamino, and Quito, who share profits and losses in the ratio of 4:3:3,
PROFESSOR:
NAME:
SECTION:
Problem #15
Determining a New Partner's Investment Cost
respectively.
Accounts Payable
Morales, Capital
Gamino, Capital
Quito, Capital
Total Liabilities and Capital
P150,000
260,000
180,000
160,000
P750,000
P 40,000
710,000
Cash
Other Assets
Total Assets
P750,000
Assume that the partnership decided to admit Abello as a new partner with a one-
fourth interest.
Required:
For each of the following independent cases, determine the amount that Abello must
contribute in cash or other assets:
1. No goodwill or bonus will be recorded.
2. A bonus of P24,000 is to be paid by Abello and allocated to the prior partners.
3. The partners agreed that total resulting capital should be P820,000 and no goodwill
should be recognized.
4. Other assets are written down by P20,000 and a bonus of P40,000 is paid to Abello
at the time of admission.
3-34 WI
WIN O
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