1.A and B formed a partnership. The following are their contributions:ABCash500,000Accounts receivable100,0003Building700,000Total600,000700,000A, capitalВ, сарital600,000700,000Total600,000700,000Additional information:The accounts receivable includes a P20,000 account that is deemed uncollectible.The building is over-depreciated by P50,000.The building has an unpaid mortgage P100,000, which is assumed by the partnership.Requirement: Provide the journal entry to record the contributions of the partners in thepartnership books.

Answered: Image /qna-images/answer/e34cdb46-685e-4f40-9a5e-b4662d4406e0.jpg

Answered: Requirement: Provide the journal entry…

Business

Accounting

Requirement: Provide the journal entry to record the contributions of the partners in the partnership books.

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter15: Partnership Accounting

Section: Chapter Questions

Problem 14MC: Thandie and Marco are partners with capital balances of $60,000. They share profits and losses at...

See similar textbooks

Related questions

Q: Prior to the creation of a partnership, the sole proprietor must first re-evaluate or adjust its…

A: Re-evaluation or Adjustment in Assets or Liability: To determine whether or not there was a net gain…

Q: Write the word or group of words that identify each of the following statements.…

A: Given is the required:

Q: In general, a partnership is described as a legal relationship that exists between two or more…

A: A partnership is regarded as the agreement that is made by two or more people with an intention to…

Q: Write the word or group of words that identify each of the following statements. 1.The word added…

A: 1) A Limited Partnership is a partnership that exists when 2 or more partners go into the business…

Q: Required: 1. Prepare a Statement of Partnership Liquidatfion 2. Prepare thejournal entries…

A: Step 1 Journal is the part of book keeping.

Q: Write the word or group of words that identify each of the following statements. 1. A partnership…

A: In a partnership form of business, liability of partners can be limited or can be unlimited, it…

Q: "a partnership balance sheet is a document that is used to keep track of the relationship of the…

A: Partnership: A legal agreement between two or more individuals for the purpose of operating a…

Q: how Prep

A: Partnership Deed is a written legal document that consists of an agreement between two individuals…

Q: Which of the following statements is TRUE? Partners are employees of the partnership. Salaries to…

A: Partnership: A partnership is defined as a relationship where two or more parties having compatible…

Q: the assets of the partnership shall be applied lastly to

A: Liquidation of partnership firm takes place while turning down the business of the firm which…

Q: partnership accounts by making a general journal entry to record the investment by Ronaldo?

A: JOURNAL ENTRIES Date Particulars Debit($) Credit($) Cash 600 Accounts receivable…

Q: A well written partnership agreement should include each of the following except ________.A. how to…

A: There are several forms of business organisation. For example, Sole proprietorship, Partnership and…

Q: istinguish between “withdrawals” and “salaries” in accounting for partnership.

A: Partnership business means where two or more person comes together to do the business and share the…

Q: Prepare a partnership Deed for a partnership business consisting of you and your family members ?

A: A partnership deed is an Associate in a Nursing agreement between the partners of a firm that…

Q: Which of the following best describes the articles of partnership agreement? The purpose of the…

A: A partnership agreement is the agreement between the partners and it may be written or verbal. Based…

Q: 2. A and B formed a partnership. The following are their contributions: (in the picture below)…

A: Journal entry is a primary entry that records the financial transactions initially.

Q: Required: 1. Prepare the journal entries for the formation of the Partnership at at July 1. 2.…

A: The assets contributed by partners are recorded under the entity concept of accounting.

Q: A partnership agreement should include each of the following except Basis for sharing net income or…

A: The partnership comes into existence when two or more persons agree to do the business and further…

Q: legal representative of any deceased partner or of any partner under legal disability.

A: RIGHT TO TRUE AND FULL INFORMATIONARTICLE 1806. Partners shall render on demand true and full…

Q: Allocation of partnership income among the partners appears on what financial statement?

A: In the partnership form of business, all partners distribute profit or loss in the ratio provided by…

Q: What journal entry is passed when a partner agrees to pay the realization expenses on the behalf of…

A: Realization account: A realization account is prepared at the time of dissolution of a firm. The…

Q: A limited partner shall have the following rights enjoyed by a general partner, except Have the…

A: Rights of Limited Partner In simple word limited partner which express the meaning of the silent…

Q: partnership

A: A partnership firm is an agreement between one or more persons to start a common business. Each…

Q: What is the JE to record the admittance of Dunn into the partnership using the goodwill (or…

A: Partnership is formed by either two or more than two person who start the business which is based on…

Q: A new partner enters a partnership and goodwill is calculated and credited to the original partners.…

A: According to method of goodwill, when the transactions occurred between two separate reporting…

Q: The following partnership accounts represent a liability of a partner to the partnership, except *…

A: Receivable from partner is current assets for firm & liability of a partner to the partnership.…

Q: Demonstrate the impact that the allocation of partnership income has on the partners’ individual…

A: Partnership: It is that form of organization which is owned and managed by two or more persons who…

Q: In accordance with the INCORPORATED PRIVATE PARTNERSHIPS ACT, 1962 (ACT 152) as amended, answer the…

A: Note: We’ll answer the first question since the exact one wasn’t specified. Please submit a new…

Q: How much additional contributions shall be made by the partners in order to settle all of the…

A: This question belongs to the liquidation of the partnership firm. Under liquidation, all the assets…

Q: Prepare journal entries to record the transactions incurred in the liquidation of a partnership.

A: In a partnership, two or more parties agree to operate and manage a business and share the profits…

Q: What are the allowable deductions to a General Professional Partnership?

A: The general professional partnership is defined as the partnership which is established through…

Q: Journalize the entries in the partnership accounts for (a) Barton's investment and (b) Fallows's…

A: The Value to be Considered for the partners bringing different assets will depend on what is agreed…

Q: When two or more sole proprietors form a partnership, their respectivebalance sheets serve as the…

A: The financial position of the company can be arrived from the income statement prepared by the…

Q: partners Required: 1. Prepare journal entries to record the formation of the partnership on January…

A: Journal Entry The basic process of accounting is to journalize the required transaction into debit…

Q: YOU ARE REQUIRED TO: 1. Prepare the entries in the General journal to record the events described…

A: Robert and Donald are partners sharing partnership profits and losses in the ratio of 3:2. They…

Q: Describe a General Professional Partnership

A: A partnership is a formal arrangement by two or more parties for the purpose of operating Business…

Q: Write the word or group of words that identify each of the following statements. 1. A…

A: Collaboration or partnership is a contractual agreement to run and maintain a company and divide its…

Q: Capital account

A: Each partner has a claim on partnership assets based on his/her. D. CAPITAL ACCOUNT.

Q: The following statements concerning the obligations and rights of a partner is correct, except *…

A: The capitalist partners cannot engage for their own account in any operation which is of the kind of…

Q: Some of the general ledger accounts of a partnership include the following: Partners' salaries…

A: Partners’ salaries The salaries of employees are business expenses that are written off to the…

Q: Discuss the main provisions of the Indian Partnership Act 1932 that arerelevant to partnership…

A: Partnership: A partnership is an unincorporated form of business which is formed by an agreement,…

Q: Using the attached information, the simple journal entries to record the partners’ contributions i

A: Working Notes :- The partners agreed to…

Q: A contract entered into among the partners stating among others-the duties and responsibilities of…

A: For every partnership type of business there shall exist a partnership agreement who shall be bind…

Q: Prepare the journat entries to record the 1ormation of the partnership

A: When any asset is brought by partners into business, the fair market value of the same is considered…

Q: (a) Explain the following (i) Partnership Deed (ii) Articles of…

A: - Partnership deed is an agreement between the partners which specifies the rights and duties of all…

Q: X Accounting for Partnershi...

Q: Describe the purpose of the articles of partnership and list specific items that should be included…

A: Articles of partnership agreement: It is a legal agreement which may be oral or written is often…

Q: A partnership agreement should include A. Provision for division of assets on dissolution B.…

A: Partnership agreement specifically prescribes how each and every aspect h it is to be dealt and…

Concept explainers

Partnership Accounting

A partnership is a kind of arrangement between two or more people whereby they agree to manage the business operations and share its profits and losses in an agreed ratio between them. The agreement that is drafted and signed by the partners of the firm is termed as partnership deed and contains various important clauses agreed between the partners such as profit/loss sharing, interest on capital, remuneration allocation of each partner, drawings, admission of a new partner, etc.

Partner Admission and Withdrawal

A partnership is a kind of arrangement between two or more people whereby they agree to manage the business operations and share its profits and losses in an agreed ratio between them. The agreement that is drafted and signed by the partners of the firm is termed as a partnership deed and contains various important clauses agreed between the partners such as profit/loss sharing, interest on capital, remuneration allocation of each partner, drawings of a partner, etc.

Question

1.
A and B formed a partnership. The following are their contributions:
A
B
Cash
500,000
Accounts receivable
100,000
3
Building
700,000
Total
600,000
700,000
A, capital
В, сарital
600,000
700,000
Total
600,000
700,000
Additional information:
The accounts receivable includes a P20,000 account that is deemed uncollectible.
The building is over-depreciated by P50,000.
The building has an unpaid mortgage P100,000, which is assumed by the partnership.
Requirement: Provide the journal entry to record the contributions of the partners in the
partnership books.

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 2 steps with 2 images

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

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.
Juan contributes marketable securities to a partnership. The book value of the securities is $7,000 and they have a current market value of $10,000. What amount should the partnership record in Juans Capital account due to this contribution? A. $10,000 B. $7,000 C. $3,000 D. none of the above
Show the solution in good accounting form On March 1, 2018, X and Y formed a partnership. The partners contributed the following: X Y Cash P500,000 P400,000 Accounts Receivable 300,000 200,000 Allowance for doubtful accounts50,000 20,000 Inventory 150,000 100,000 Equipment 500,000 200,000 Accumulated depreciation 100,000 25,000 Accounts Payable 50,000 400,000 Note Payable 200,00 The partners agree on the following: a. P10,000 of the accounts receivable of X is to be written-off. b. An allowance for doubtful accounts of 15% is to be established on the remaining receivatbies of X and Y. C. The inventory of Y is to be valued at P140,000. D. The equipment of X is under depreciated by P20,000 and the equipment ofY has a fair value of P190,000. E.…
Show the solution in good accounting form On March 1, 2018, X and Y formed a partnership. The partners contributed the following: X Y Cash P500,000 P400,000 Accounts Receivable 300,000 200,000 Allowance for doubtful accounts50,000 20,000 Inventory 150,000 100,000 Equipment 500,000 200,000 Accumulated depreciation 100,000 25,000 Accounts Payable 50,000 400,000 Note Payable 200,00 The partners agree on the following: a. P10,000 of the accounts receivable of X is to be written-off. b. An allowance for doubtful accounts of 15% is to be established on the remaining receivatbies of X and Y. C. The inventory of Y is to be valued at P140,000. D. The equipment of X is under depreciated by P20,000 and the equipment ofY has a fair value of P190,000. E.…
On March 1, 2018, X and Y formed a partnership. The partners contributed the following:X YCash P500,000 P400,000Accounts Receivable 300,000 200,000Allowance for doubtful accounts 50,000 20,000Inventory 150,000 100,000Equipment 500,000 200,000Accumulated depreciation 100,000 25,000Accounts Payable 50,000 400,000Note Payable 200,000The partners agree on the following:a. P10,000 of the accounts receivable of X is to be written-off.b. An allowance for doubtful accounts of 15% is to be established on the remaining receivables of Xand Y.c. The inventory of Y is to be valued at P140,000.d. The equipment of X is under depreciated by P20,000 and the equipment of Y has a fair value ofP190,000.e. The note of X is dated December 1, 2017 and is subject to a 12% interest . Interest had not yetbeen accrued.f. The partners agree on a 2:1 profit and loss ratio.g. The partners agree to bring their capital balance proportionate to their profit and loss ratio.If Y's Capital is to be used as basis, how…
On January 02, 2019, the business assets and liabilities of Gail Anne & Precious were as follows: Gail AnnePrecious CashP28,000P62,000 Receivables 200,000 600,000 Inventories 120,000 200,000 PPE 650,000 535,000 Other Assets 2,000 3,000 Accounts Payable 180,000 250,000 Notes Payable 200,000 350,000 Gail Anne and Precious agreed to form a partnership by contributing their net assets subject to the following adjustments: ➢ Receivables of P20,000 in Gail Anne’s books and P40,000 in Precious’ books are uncollectible ➢ Inventories of P6,000 and P7,000 in the respective books of Gail Anne and Precious are worthless ➢ Other assets in both books are to be written off ➢ Accrued interest on notes payable equal to 10% is to be established. The note payable of Gail Anne was dated August 01, 2018 while that of Precious, was dated April 01, 2018. The balances of selected accounts after the formation are: Assets…
1. As of July 1, 2020, MM and AA decided to form a partnership. Their balance sheets on this date are: Cash P 15,000 P 38,000Accounts Receivable 680,000 255,000Allowance for doubtful accounts (140,000) (30,000)Merchandise Inventory 202,000Machinery and Equipment 150,000 270,000Total P705,000 P735,000 Accounts Payable 135,000 240,000MM, capital 570,000AA, capital - 495,000Total P705,000 P735,000 The partners agreed that the machinery and equipment of MM is under depreciated by P15,000 and that of AA by P45,000. Allowances for doubtful accounts is to be set up amounting to P120,000 for MM and P40,000 for AA. The partnership agreement…
3.Octillery and Delibird agreed to list down the following assets to be contributed to the partnership: Octillery P20,000 15000 Delibird P30,000 15,000 40,000 Cash Inventory Building Furniture & Fixture The building is subject to a mortgage loan, already past due, in the amount of P10,000. Octillery paid this out of his personal funds aside from his cash contribution above. Partners agreed that Octillery should be credited for this. Partnership agreement calls for even division of profits and losses. Required What amount should be listed as capital for each of the partners?
On March 1, 2018, X and Y formed a partnership. The partners contributed the following:X YCash P500,000 P400,000Accounts Receivable 300,000 200,000Allowance for doubtful accounts 50,000 20,000Inventory 150,000 100,000Equipment 500,000 200,000 Accumulated depreciation 100,000 25,000Accounts Payable 50,000 400,000Note Payable 200,000 The partners agree on the following:a. P10,000 of the accounts receivable of X is to be written-off.b. An allowance for doubtful accounts of 15% is to be established on the remaining receivables of Xand Y.c. The inventory of Y is to be valued at P140,000.d. The equipment of X is under depreciated by P20,000 and the equipment of Y has a fair value ofP190,000.e. The note of X is dated December 1, 2017 and is subject to a 12% interest . Interest had not yetbeen accrued.f. The partners agree on a 2:1 profit and loss ratio.g. The partners agree to bring their capital balance proportionate to their profit and loss ratio.If Y's Capital is to be used as basis, how…
5. Maria brought in her business to the partnership, the accounts receivable has a P 100,000 balance, it was agreed that the net realizable value of the receivable should be adjusted to P 75,000. What should be the amount of allowance for bad debts? a. 65,000 b. 15,000 c. 25,000 d. 55,000
On February 28, 2022, Aris and Yang formed a partnership. The partners agreed to invest equal amounts of capital. Aris invested his proprietorship’s assets and liabilities as follows: Account Book Value Fair Value Accounts Receivable ₱72,000 ₱72,000 Allowance for Bad Debts 0 10,500 Merchandise Inventory 223,400 241,000 Prepaid Expenses 17,000 17,000 Office Equipment 459,000 276,000 Accumulated Depreciation 153,000 0 Accounts Payable 191,000 191,000 On February 28, Yang invested cash in an amount equal to the current market value of Aris’ partnership capital. Prepare the journal entries to record the partner’s initial investment in the new partnership Prepare the partnership’s statement of financial position immediately after its formation on February 28, 2022