Partners ABC, DEF and GHI share profits and losses in the ratio of 2:3:5, respectively. At the end of a very unprofitable year, they decided to liquidate the firm. The partner's capital account balances at this time are as follows: ABC - P22,000; DEF -P24,900 and GHI - P15,000. The liabilities accumulate to P30,000, including a loan of P5,000 from ABC. The cash balance is P6,000. All the partners are personally solvent. The partners plan to sell the assets in installment. If ABC received a total of P50,000 as a result of the liquidation, what was the total amount realized from the sale of the non-cash assets?

Partners ABC, DEF and GHI share profits and losses in the ratio of 2:3:5, respectively. At the end of a very unprofitable year, they decided to liquidate the firm. The partner's capital account balances at this time are as follows: ABC - P22,000; DEF -P24,900 and GHI - P15,000. The liabilities accumulate to P30,000, including a loan of P5,000 from ABC. The cash balance is P6,000. All the partners are personally solvent. The partners plan to sell the assets in installment. If ABC received a total of P50,000 as a result of the liquidation, what was the total amount realized from the sale of the non-cash assets?

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.
The following are independent events: a. A partnership is preparing to become a corporation and sell stock to the public. At this time, it decides to switch from accelerated to straight-line depreciation. b. A company has been debiting half its advertising costs to an intangible asset account and amortizing these costs over 3 years. c. A company has been using accelerated depreciation. It now estimates that the pattern of benefits to be received in the future will be equal each period, so it decides to change to the straight-line depreciation method. d. A company has been using straight-line depreciation for its property, plant, and equipment. It is now buying a new type of machine and elects to use accelerated depreciation on the new machine. e. A company switches from capitalizing certain expenditures to expensing them due to the issuance of an Accounting Standards Update that makes capitalization of these expenditures no longer generally accepted. Required: Identify the correct accounting treatment for the changes (if any) related to the preceding events.
The partnership of Magda and Sue shares profits and losses in a 50:50 ratio after Mary receives a $7,000 salary and Sue receives a $6,500 salary. Prepare a schedule showing how the profit and loss should be divided, assuming the profit or loss for the year is: A. $10,000 B. $5,000 C. ($12,000) In addition, show the resulting entries to each partners capital account.
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AAA, BBB, CCC, and DDD are partners sharing profits in the ratio of 3/21, 4/21, 6/21, and 8/21. Their capital balances on December 31, 2030 are as follows:AAA P 500BBB 12,500CCC 12,500DDD 4,500The partners decide to liquidate their firm and they accordingly convert the noncash assets into P11,600 cash. After paying liabilities of P1,500, they have P11,100 to divide. How much was the distribution to partner CCC?a. P0 b. P3,560 c. P4,160 d.P7,100
Ebanks, Brown, and Thomas are partners. They carry on a business jointly as EBT surveyors and shareprofits and losses in the ratio 25:45: 30. The trading account profit as at 31 December 2021 was $6,500,000 after charging a nominal tax of$750,000. Notes: 1. The partners receive interest on their capital accounts at 9.5 % on the balance of their partnercapital at the end of the budget year. The interest on the capital account was not included in theincome statement. 2. Include in the income statement is $80,000 salary per month for each partner. 3. The partnership paid motor vehicle expenses for vehicles owned by the partners as follows: - Ebanks -$ 50,000 - Brown - $80,000 - Thomas - $130,000 The partners did not use the vehicles for the partnership business. 4. Profit on disposal was $180,000.5. Depreciation on plant and machinery for the year was $900,000.6. In recognition of the new IFRS 9 standard, a provision for bad debt of $75,000 was made. Thisrepresents a % of the business…
Ebanks, Brown, and Thomas are partners. They carry on a business jointly as EBT surveyors and shareprofits and losses in the ratio 25:45: 30. The trading account profit as at 31 December 2021 was $6,500,000 after charging a nominal tax of$750,000. Notes: 1. The partners receive interest on their capital accounts at 9.5 % on the balance of their partnercapital at the end of the budget year. The interest on the capital account was not included in theincome statement. 2. Include in the income statement is $80,000 salary per month for each partner. 3. The partnership paid motor vehicle expenses for vehicles owned by the partners as follows: - Ebanks -$ 50,000 - Brown - $80,000 - Thomas - $130,000 The partners did not use the vehicles for the partnership business. 4. Profit on disposal was $180,000.5. Depreciation on plant and machinery for the year was $900,000.6. In recognition of the new IFRS 9 standard, a provision for bad debt of $75,000 was made. Thisrepresents a % of the business…
Ebanks, Brown, and Thomas are partners. They carry on a business jointly as EBT surveyors and shareprofits and losses in the ratio 25:45: 30. The trading account profit as at 31 December 2021 was $6,500,000 after charging a nominal tax of$750,000. Notes: 1. The partners receive interest on their capital accounts at 9.5 % on the balance of their partnercapital at the end of the budget year. The interest on the capital account was not included in theincome statement. 2. Include in the income statement is $80,000 salary per month for each partner. 3. The partnership paid motor vehicle expenses for vehicles owned by the partners as follows: - Ebanks -$ 50,000 - Brown - $80,000 - Thomas - $130,000 The partners did not use the vehicles for the partnership business. 4. Profit on disposal was $180,000.5. Depreciation on plant and machinery for the year was $900,000.6. In recognition of the new IFRS 9 standard, a provision for bad debt of $75,000 was made. Thisrepresents a % of the business…
Ebanks, Brown, and Thomas are partners. They carry on a business jointly as EBT surveyors and shareprofits and losses in the ratio 25:45: 30. The trading account profit as at 31 December 2021 was $6,500,000 after charging a nominal tax of$750,000. Notes: 1. The partners receive interest on their capital accounts at 9.5 % on the balance of their partnercapital at the end of the budget year. The interest on the capital account was not included in theincome statement. 2. Include in the income statement is $80,000 salary per month for each partner. 3. The partnership paid motor vehicle expenses for vehicles owned by the partners as follows: - Ebanks -$ 50,000 - Brown - $80,000 - Thomas - $130,000 The partners did not use the vehicles for the partnership business. 4. Profit on disposal was $180,000.5. Depreciation on plant and machinery for the year was $900,000.6. In recognition of the new IFRS 9 standard, a provision for bad debt of $75,000 was made. Thisrepresents a % of the business…
Ebanks, Brown, and Thomas are partners. They carry on a business jointly as EBT surveyors and shareprofits and losses in the ratio 25:45: 30. The trading account profit as at 31 December 2021 was $6,500,000 after charging a nominal tax of$750,000. Notes: 1. The partners receive interest on their capital accounts at 9.5 % on the balance of their partnercapital at the end of the budget year. The interest on the capital account was not included in theincome statement. 2. Include in the income statement is $80,000 salary per month for each partner. 3. The partnership paid motor vehicle expenses for vehicles owned by the partners as follows: - Ebanks -$ 50,000 - Brown - $80,000 - Thomas - $130,000 The partners did not use the vehicles for the partnership business. 4. Profit on disposal was $180,000.5. Depreciation on plant and machinery for the year was $900,000.6. In recognition of the new IFRS 9 standard, a provision for bad debt of $75,000 was made. Thisrepresents a % of the business…
Moose, Booze and Goose are partners with capital balances of P 320,000, P 450,000 and P 520,000 respectively with profit and loss sharing ratio of 2:3:5 respectively. The firm owes Booze P 20,000. Upon liquidation, P 390,000 is available for distribution to the partners. What amount of cash will Moose receive? a. P78,000 b. P136,000 c. P258,000 d. P320,000