Problem 8 April, May and June decided to form a partnership on January 1, 2018 to operate a retail store. April and May both owned a retail store with the following account balances: ENTIA APRIL MAY 10,000,000 Cash Receivables 15,000,000 1911 20,000,000 Inventories PPE 5,000,000 BAGUIO C20,000,000 10,000,000 Accounts Payable Notes Payable 25,000,000 15,000,000 (10%) (5%) Capital 40,000,000 15,000,000 The following are to be taken up by the partnership: b. a. April and May will contibute all their assets and liabilities in the newly formed partnership. The parties agree to provide a 10% and 20% allowance for bad debts on the receivables of April and May. e. The inventories of April and May have fair values of P30,000,000 and P22,500,000, respectively. The PPE of April and May have never been depreciated and should be depreciated by 40% and 30%, respectively. d. e. The interest payable on both notes payable were unrecorded and unpaid since the date of contract. April's note payable is dated April 1, 2017 while May's note payable is dated June 30, 2017. f. June shall have a 20% interest in the partnership upon contribution of sufficient cash. What is the amount of cash to be contributed by June on January 1, 2018?

Problem 8 April, May and June decided to form a partnership on January 1, 2018 to operate a retail store. April and May both owned a retail store with the following account balances: ENTIA APRIL MAY 10,000,000 Cash Receivables 15,000,000 1911 20,000,000 Inventories PPE 5,000,000 BAGUIO C20,000,000 10,000,000 Accounts Payable Notes Payable 25,000,000 15,000,000 (10%) (5%) Capital 40,000,000 15,000,000 The following are to be taken up by the partnership: b. a. April and May will contibute all their assets and liabilities in the newly formed partnership. The parties agree to provide a 10% and 20% allowance for bad debts on the receivables of April and May. e. The inventories of April and May have fair values of P30,000,000 and P22,500,000, respectively. The PPE of April and May have never been depreciated and should be depreciated by 40% and 30%, respectively. d. e. The interest payable on both notes payable were unrecorded and unpaid since the date of contract. April's note payable is dated April 1, 2017 while May's note payable is dated June 30, 2017. f. June shall have a 20% interest in the partnership upon contribution of sufficient cash. What is the amount of cash to be contributed by June on January 1, 2018?

Accounting (Text Only)

26th Edition

ISBN:9781285743615

Author:Carl Warren, James M. Reeve, Jonathan Duchac

Publisher:Carl Warren, James M. Reeve, Jonathan Duchac

Chapter12: Accounting For Partnerships And Limited Liability Companies

Section: Chapter Questions

Problem 12.4BPR

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April, May and June decided to form a partnership on January 1, 2018 to operate a retail store. April and May both owned a retail store with the following account balances: APRIL MAYCash 5,000,000 10,000,000Receivables 10,000,000 15,000,000Inventories 35,000,000 20,000,000PPE 25,000,000 5,000,000Accounts Payable 20,000,000 10,000,000Notes Payable 15,000,000 25,000,000 (10%) (5%)Capital 40,000,000 15,000,000 The following are to be taken up by the partnership:a. April and May will contribute all their assets and…
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