Partnership – Basic Considerations and Formation

1

CHAPTER 1
MULTIPLE CHOICE ANSWERS AND SOLUTIONS
1-1: a
1-2: b
1-2: c

Jose's capital should be credited for the market value of the computer contributed by
him.
(40,000 + 80,000) ÷ 2/3 = 180,000 x 1/3 = 60,000.

1-3: a
Cash
Land
Mortgage payable

P100,000
300,000
( 50,000)

Net assets (Julio, capital)

P350,000

Total Capital (P300,000/60%)
Perla's interest

P500,000
______40%

Perla's capital
Less:Non-cash asset contributed at market value
Land
P 70,000
Building
90,000
Mortgage Payable
( 40,000)

P200,000

Cash contribution

P 80,000

1-4: b

1-5: d

_120,000

- Zero, because under the bonus method, a transfer of capital is only required.

1-6: b
Reyes

Santos

P200,000

Cash
Inventory
Building
Equipment
Mortgage payable

________

P300,000
150,000
400,000
150,000
( 100,000)

Net asset (capital)

P350,000

P750,000

AA

BB

CC

P55,000
P55,000

1-7: c
Cash
Property at Market Value
Mortgage payable
Equipment at Market Value

P 50,000
_______

P 80,000
( 35,000)
_______

Capital

P 50,000

P 45,000

000 .000 P 80. equally (P300.P130.000 160.000 1-12: a Perez Cash Office Equipment Merchandise Furniture Notes payable P 50.000 Maria Nora 1-9: c Cash Merchandise inventory Computer equipment Liability Furniture and Fixtures P 30.000 1-10: d Roy Sam Tim Cash Office Equipment Note payable P140.000 200.000 P160.000 _______ P 25.000) = P110.000 _( 60.000/40%) Nora's interest P575.000 ( 60.000 __25.000 – _______ Reyes P 70.000 Total agreed capital (P230.000) – .000 P 85.000 ( 50.000 1-11: a Lara Mitra Cash Computer equipment Note payable P130.000 __60.000 ______60% Nora's agreed capital Less: investment P345.000 50.000 P190.000 – 110.000 Cash to be invested P155.000 Capital P 75.000 P 90.000 _( 10.2 Chapter 1 1-8: a PP RR SS Cash Computer at Market Value P 50.000 P 80.000 100.000/3) = P100.000 – ________ P200.000 P Agreed capitals.000) ________ Total contribution P230.000 190.000) – – ______ Net asset invested P140.000 – ________ – P220.000 30.000 Goodwill (P240.000) Net asset invested P130.000 P240.

000 1-14: d Total assets: Cash Machinery Building Less: Liabilities (Mortgage payable) P 70.000 __90.000-P500) 9.000 Goodwill Method: Net assets invested Add: Goodwill (P230.500 Merchandise inventory (P15.000 Furniture and fixtures __10.000 __65.000 .000 __30.000 _225.000 P150.000 ____70% Total partnership capital P400.000 Merchandise __10.000 X 30%) Less Assets already contributed: Cash P 30.000 3 Bonus Method: Total capital (net asset invested) P310.000 Machinery and equipment 25.000 Cash to be contributed by Ruiz P 60.000 _150.000/2) Contributed capital of Ruiz: Total assets P105.000 P370.000 P 44.000 Asset contributed by D.000 Cash to be invested by Cruz P 55.000 Net assets (equal to Ferrer's capital account) Divide by Ferrer's P & L share percentage P280. Arce: Cash P 20.000 75.000 1-15: d Adjusted assets of C Borja Cash P 2.000 Net capital P460.000) P310.000 1-13: b Required capital of each partner (P300.000-P3.000 Total assets of the partnership P 74.000 __90.000 P120.000-P80.Net asset invested Partnership – Basic Considerations and Formation P 80.000 Less Liabilities __15.500 Accounts Receivable (P10.000 Required capital of Cruz (P400.000 Fixtures __20.000) 12.000 P230.

500 ______60% P172.500 ______40% Total partnership capital Flores' P & L share percentage P101.000 P 77.000 Total partnership capital Multiply by Nakar's P & L share percentage Required capital of credit of Nakar: Contributed capital of Nakar: Merchandise inventory Land Building Total assets Less Liabilities Required cash investment by Nakar P115.000) P158.900/2/3) Multiply by Mendez's interest P248.400 17.000 ______40% P287.850 1-17: d Moran.000 P 95.000 P125.000 __65.950 __50.000 _100.900 __82.500 1-18: c Garcia's adjusted capital (see schedule 1) Divide by Garcia's P & L share percentage P40.500 ( 5.000 __30.750 .850 ⅓ Mendez's capital Less Merchandise contributed P 82.000 15.500 P 45.000) _( 5.950 Total capital P248.250 ______60% Flores' capital credit P 60. capital (40%) Cash Furniture and Fixtures Divide by Moran's P & L share percentage P 15.4 Chapter 1 1-16: a Cash to be invested by Mendez: Adjusted capital of Lopez (2/3) Unadjusted capital Adjustments: Prepaid expenses Accrued expenses Allowance for bad debts (5% X P100.000) Adjusted capital P165.000 Cash to be invested by Mendez P 32.950 Total Capital: Adjusted capital of Lopez Contributed capital of Mendez P165.900 Total partnership capital (P165.

000) Adjusted balance P 43.000 ( 4.000 Merchandise to be invested by Gomez P 90.000/60%) P300.500 Schedule 2: Flores capital: Unadjusted balance Adjustments: Accumulated depreciation Allowance for doubtful accounts P 57.000 Gomez's capital (P300.000 X 40%) Less Cash investment P120.700) 3.500 Divide by the total percentage share of Ortiz and Ponce (50% + 30%) ______80% Total capital of the partnership before the admission of Roxas Multiply by Roxas' interest P296.500) Adjusted balance P 40.000 P132.000 __48.Flores' contributed capital (see schedule 2) __43.000 P108.000 __30.000 Cash to be invested by Jocson: Adjusted capital of Jocson: Total assets (at agreed valuations) Less Accounts payable P180.800) 2. capital: Unadjusted balance Adjustments: Accumulated depreciation Allowance for doubtful account P 49.000 .500) ( 4.375 1-20: d Merchandise to be invested by Gomez: Total partnership capital (P180.500 1-19: d Ortiz Ponce Total ( 60%) ( 40%) P133.500) 5.400) Adjusted capital balances P130.000 _( 2.000) P237.000 ( 1.500) ( 12.600) P106.000 ( 4.500 Additional cash to be invested by Flores P 17.000 ( 1.250 Partnership – Basic Considerations and Formation 5 Schedule 1: Garcia.000 P241.000 Unadjusted capital balances Adjustments: Allowance for bad debts Inventories Accrued expenses ( 2.875 ______20% Cash to be invested by Roxas P 59.500 ( 4.500 Total capital before the formation of the new partnership (see above) P237.900 ( 1.

000 P 688.000) P3.000 (1.000 Capital transfer (Bonus) P 88.000-P12.000 P291.000.000 Total partnership capital (P113.800 191.000 ÷ 70%) Eden agreed profit & loss ratio Eden agreed capital Eden contributed capital at fair value Allocated cash to be invested by Eden P5.500. capital P 65.000) Allowance for doubtful accounts Accounts payable P 70.000 225.000 – P5.200 1-22: c 1. capital (P75.600 1-26: d Total agreed capital (P90.000 812.200 1-23: a Total assets at fair value Liabilities Capital balance of Flor P4.640/1/3) Less David's capital P340.000 ÷ 40%) Contributed capital of Candy (P126.400 957.000 Total capital of the partnership (P3.000 ( 1.000 .000 P195.000 1-24: c 1-25: c __Rey __Sam_ __Tim __Total_ Contributed capital (assets-liabilities)P471.000) Merchandise inventory Prepaid expenses Accrued expenses P227.000) ( 5.000+P36.000 ÷ 40%) Candy.000 Cash to be invested by Jocson P 48.000 150.200) ___3.800) P 3.000) ( 4.000 30% 1.000 P 15.500.000 60% 135.800 382.500. agreed capital interest Agreed capital of Candy Contributed capital of Candy Withdrawal P225.000 6 Chapter 1 1-21: b Unadjusted Ell.000) Adjusted Ell.000 150.280 Cortez's capital before adjustments P211.Required capital of Jocson _180.920 ( 16.125.920 _113.625.000 Agreed capital (profit and loss ratio) 382.000) Total agreed capital (P90.200 P(91.000 P957.640 Cortez's capital after adjustments Adjustments made: Allowance for doubtful account (2% X P96.

000) P 8.000 P184.000 P( 8.000 92.000 210.000 P84.000 1-29: c Contributed capital Agreed capital Capital invested __Alex__Carlos_ __Total__ P100.000 P 72.000 184.000 30% P 90.000 P 48.000 .000 92.000 ÷ 70%) Nora’s interest Agreed capital of Nora Cash invested Cash to be invested by Nora P300.Partnership – Basic Considerations and Formation 7 1-27: a Total agreed capital (210.000 42.000 - .000 x 70%) Cash to be invested by May P138.000) Agreed capital of May (P300.P56.000 1-28: a Contributed capital of May (P194.

....... Capital.................................000 x 6% x 3/12 = P2................................... 400 100 800 400 To record the investment of Jose Bunag....50 Jose Bunag... 1.. Pedro Castro...................... Pedro Castro....... Accumulated Depreciation – Furniture and Fixtures.............................................................................. Pedro Castro........000 x 6% x 2/12 = 600 200 35 P15 _20 Total.................. Capital......................................................... Allowance for Bad Debts...... Accrued Interest Payable........ 800 6................. Merchandise Inventory.................... 200 3...P35 4.... Capital............ 15............. (P4.....000 x 5% x 6/12 = P100) 100 5...............................400 (2) 200 35 (3) (4) 100 400 (6) (5) ___800 P1..... a...........700 P31.. Pedro Castro.......... Books of Pedro Castro will be retained by the partnership To adjust the assets and liabilities of Pedro Castro. Accrued Interest Receivable.......... Capital................................. Pedro Castro......................... 600 2......... Cash.................... Capital.......... ................067............................................... Capital (1) P600 P31..................... Capital........ Pedro Castro..........................835 15.......................................................50 ....................................................... 35 Computation: P1..8 Chapter 1 SOLUTIONS TO PROBLEMS Problem 1 – 1 1.................................................... Office Supplies.067.. Computation: Pedro Castro........ Capital.......................

...........P30.....................................067........................................................ Pedro Castro................... Notes Receivable....................................................................................................................... Accrued Interest Payable........ Allowance for Bad Debts.. Furniture and Fixtures................000 3... Accrued Interest Receivable... Pedro Castro......135 .................................000 3...........................................000 24..... Notes Payable....................................................... Merchandise Inventory.................................................................. 9 A new set of books will be used Books of Pedro Castro To adjust the assets and liabilities...........400 400 6................................. Cash.............................................................. See Requirement (a)................................................................135 = P15........................................50 Partnership – Basic Considerations and Formation b...... Accrued Interest Payable.......000 4................................................. Notes Receivable........................................000 24..000 New Partnership Books To record the investment of Pedro Castro......................... Capital : 1/2 x P30..000 35 7......... 4........135 Jose Bunag.. To record the investment of Jose Bunag..........................................................000 100 1.................................... Accounts Payable............................ Capital... Accounts Receivable..............................................400 400 6................................... Furniture and Fixtures.......... Accrued Interest Receivable......400 30.................................. Office Supplies.............. Allowance for Bad Debts...... Capital.200 1...........400 30.................................................. Accumulated Depreciation – Furniture and Fixtures..... Notes Payable.................000 10........200 1......135 6........................ Accounts Receivable............................................................................................... Office Supplies................000 100 1.............................. 6.......... To close the books......................................................................... Cash ...................000 10.......................000 35 7....................... Merchandise Inventory.............................................. Accumulated Depreciation – Furniture and Fixtures................... Accounts Payable....................................................

.........................00 _15.....................50 Problem 1 – 2 Contributed Capitals: Jose: Capital before adjustment.......................000 Less Allowance for bad debts....302............ 6...50 Jose Bunag..... Accounts payable...................................500 ........................600........................................ P59.................................................... 62.......000 28................................302....067.000. _57..........................................000 Marketable securities..............................000 Underdepreciation.......... 3... 15.................... P 24...................................................................................................... Agreed Capitals: Bonus Method: Jose (P231.......................500 P 231....... Jose Bunag....067........................ Castro and Bunag Partnership Balance Sheet October 1.....................................200 22....................................................................00 Furniture and fixtures..................... ( 25..................400 __4.................................................. 400........................ 7......................................................000 Notes Payable..................500 Total contributed capital..................... Capital.....................00 Accrued interest receivable.00 Merchandise inventory....... Capital....... ___1................................800............00 Office supplies ..........50 Liabilities and Capital Notes payable ............................................................................................500 x 50%)..............50 10 Chapter 1 2...............................000 Less Accumulated depreciation........................ Pedro Castro. Pablo: Cash...............00 Accounts receivable..00 10.......00 30................................ .......... P21......................... ___1........................... 13. 35.............. P115............................................................................Cash....135............000) Pedro: Cash......................................067....................................................00 Total Assets...............................................................400........... 15......................... P 85.................................................... 2008 Assets Cash ............................000..................................000 Undervaluation of inventory....000.............................000 ___68... Capital........................................................................................ Total Liabilities and Capital............. 11.............. Accrued interest payable.......................................50 P59........................................................................................ P 4...................067........................................................................................................................................00 100..............50 Notes receivable.................750 P 135.........

..000 45..000 P 53.000 48.........875 Total............. Books of Pepe Basco To adjust the assets..000 48... 3....500 Goodwill P137......500 __68..500 (25%) __68.......500 x 25%)...............000 Jose.500 x 25%).....750 57.500 P327............. Capital....... a. The computation is: Contributed Capital Jose Pedro Pablo Total Agreed Capital P135..000 28.500 85..000 (50%) 68......................000 115...............500 ÷ 25%) = 274.....000 __68..500 P327.. __57...000 45....000 __42.500 P231.... capital (50%) Pedro......... 57.500 P 53.......875 __57............. P231.500 85...............000 137..000 40.. Pepe Basco........... Pedro and Pablo Partnership Balance Sheet June 30...... capital (25%) Total Problem 1 – 3 1...........500 P 49...000 Liabilities and Capital: Accounts payable Jose..Pedro (P231............000 57....000 57.875 Pablo (P231.500 (25%) 274....... capital (25%) Pablo..........000 ______– P284............200 ..... To have a goodwill..500 _____– 42...875 P284. the only possible base is the capital of Pablo..... 2008 Assets: Cash Accounts receivable (net) Marketable securities Inventory Equipment (net) Goodwill Total Bonus Method Goodwill Method P 49. ....500 Total agreed capital (P68.........000 2....500 Partnership – Basic Considerations and Formation 11 Goodwill Method.................000 68.

. Estimated Uncollectible account........................................ 4...................................................... capital (Base)............................... Accumulated Depreciation – Furniture and Fixtures.......... .600 31.................................. Adjusting Entries 47.......250 47.... Computation: Pepe Basco............ Capital...........Estimated Uncollectible Account................... 400 16...........................................................................................800 1................................250 .................................... b...... Cash........ Divide by Pepe Basco's P & L ratio.............................................................. Carlo Torre.............. Pepe Basco.000 20........................................................... Merchandise Inventory............ Pepe Basco......................................................................... Accounts Payable................................................ Capital..............000 5......................................500 To record the investment of Carlo Torre.500 ___40% P78....................200 500 500 12 Chapter 1 To close the books.....000 Books of the Partnership To record the investment of Pepe Basco................... Estimated Uncollectible Account................... Furniture and Fixtures....... 3...500 400 16.......................... Total agreed capital................................................................250 P31.......... Furniture and Fixtures...500 3..................................................................................... 2.................. Cash........................................................................................ Capital.............................................................................. Roces' books will be used by the partnership Books of Sales 1........ Cash................ Cash to be invested by Carlo Torre............................................. Accumulated Depreciation – Furniture and Fixtures....000 4....500 3...800 1....... Accounts Payable...000 5... Problem 1 – 4 a.000 20............................................................................................. Pepe Basco............. Capital..................... Accumulated Depreciation – Furniture and Fixtures.......................... Accounts Receivable......................... Multiply by Carlo Torre's P & L ratio.................................................. Accounts Receivable................................................................................. Merchandise Inventory............................600 31.............................750 ___60% P47..

.........................000 (c) Merchandise Inventory.......................000 32............................................. Delivery Equipment............................................ Capital.............. Capital....................................................... Merchandise Inventory........ Notes Payable.......... Accumulated Depreciation – Delivery Equipment........ 40.................................000 Books of Roces (Books of the Partnership) 1........................000 Partnership – Basic Considerations and Formation 2......... 8.............................800 8....................... Roces.... Prepaid Insurance............ Accounts Inventory.................................. Accounts Payable................................000 32...................................000 91.................. Sales....................................................................................200 48.............................................................. 13 Closing Entry Allowance for Bad Debts.................................................. Capital........................................................ 3........................200 64..000 To record the investment of Sales................................. Allowance for Bad Debts.000 3.......... Accumulated Depreciation – Fixtures................................... Fixtures.................... Sales.. Goodwill...............000 ....... Cash..... Delivery Equipment................ Allowance for Bad Debts.......... 4................................................................. 32................. Accrued Taxes............................. 1.......................000 4................................ Prepaid Insurance..................000 224.. Fixtures................................................................. Cash.................200 32..000 1........... 16.....................................000 192............................ Accounts Receivable.........200 48.....................600 16.....600 (b) Accumulated Depreciation – Fixtures.................................................................................... Capital.........................000 96...000 40. Roces........................................ Adjusting Entries (a) Roces.800 72...................................800 72.....................................................200 (b) Goodwill.. 12........................................................................(a) Sales............................000 12........................................................................ Goodwill. Accumulated Depreciation – Fixtures........000 40..000 192.................................................. Accumulated Depreciation – Delivery Equipment.......................................................000 3......000 (d) Goodwill........800 8.................................................................................................................................. Capital..................... Capital................. Merchandise Inventory................................................. Capital...............................000 8..................................................................................................................................000 96..........................................000 8................................ Roces................ 2..................................................................................................000 3......

.... Accumulated Depreciation – Delivery Equipment...................................................................................................... 91...............600 132................... 14.....................................................600 12............000 104.................000 6..................... Sales.. Prepaid Insurance..................000 8.800 64............................................................... Roces........................................000 Books of Sales (Books of the Partnership) 1.......................800 19..... Accounts Receivable.......................... Accumulated Depreciation – Fixtures.800 4. 1..000 1..........................................................................000 40.. Notes Payable.000 14..........400 57......... Merchandise Inventory...000 40................ Goodwill............................... Delivery Equipment......400 57....................................................................... Allowance for Bad Debts......................................................................................................................... Closing Entry Allowance for Bad Debts................................................................................................800 4...................... Fixtures........................ Accumulated Depreciation – Fixtures.......................... Delivery Equipment............................................000 104................................ Accrued Taxes.................................................................................................................................................................200 144......... Capital........ Prepaid Insurance........ Fixtures.......................................000 40............................................. Goodwill............................................600 12..............................200 144........ Adjusting Entries See Requirement (a).... 2....Accumulated Depreciation – Fixtures.......................................................................... Accounts Payable................................. Merchandise Inventory... Cash.......000 224......................... Adjusting Entries See Requirement (a).. 2. Accrued Taxes....... Cash.............. Sales' books will be used by the partnership Books of Roces 1................................................................................................................... Capital...800 64....................................................... Accounts Receivable....... To record the investment of Roces......................................200 64................................000 14 Chapter 1 b.........400 224......................................000 ................................................800 19.......................... Accounts Payable.......... Accounts Payable.....................................600 132................................. Accumulated Depreciation – Delivery Equipment..............

.. Adjusting Entries See Requirement (a).................................................................. Prepaid Insurance....Accrued Taxes...............................................000 224.....200 129.. Capital.............................000 224........... 2...... Cash................................................................................. New Partnership Books To record the investment of Roces and Sales................ Adjusting Entries See Requirement (a)...................................................000 46...................................400 84........................... Closing Entry See Requirement (a)............................................. Sales.............................. Accounts Receivable.............................. Accounts Payable.................................................................................................................................................................... 15 A new set of books will be opened by the partnership Books of Roces 1...... Books of Sales 1.....000 14..... Accrued Taxes........................................................800 72. 19..........................................................................................400 224......... 6....... Roces......400 168....800 8....... Fixtures (net)..600 324....................................... Delivery Equipment (net).............. Goodwill ........... Merchandise Inventory................... Notes Payable..........000 ....................................... Capital..................................000 14.................... Roces....000 Partnership – Basic Considerations and Formation c..... 2......... Allowance for Bad Debts............ Capital........................................ Closing Entry See Requirement (b)......000 40............................................................................

......... Magno.................................300 10.............................. Allowance for Bad Debts.......................................... Cash..................... R.................................16 Chapter 1 Problem 1 – 5 1................... 1............... 5......000 9......................................................................................................................................................... Goodwill................................................................ Equipment.......000 13.. Capital................................................................... Other Assets.................000 3................000 1...........................000 10..... Accrued Interest Payable........790 To record the investment of Magno.................. R...................... 5................ Accounts Payable...............................000 13.. 3.................. ...... J........................................700 = P10.....................................700 8........................000 210 7.................................. Accrued Interest Payable.......................................................................................................................................................000 12...................000 300 24....................................... Allowance for Bad Debts..................................................... Capital..................................................... Notes Payable............................................................000 9...................000 12...............................000 6....000 10.................. Merchandise Inventory........ Magno..................... Accounts Payable..................................................................300 ........................ Equipment............................ Magno.................................................. Capital................................000 6....................................................700 To adjust the investments of the partners..........................000 300 24............. Cash...................000 3..................................300) 10.................... Merchandise Inventory.....................000 To adjust the books of Lagman.......................... Lagman......... Allowance for Bad Debts..... Accounts Receivable.................... (P35............... Capital............................................................. R................... 2.. Other Assets... Cash............000 – P24.. Accounts Receivable...................... To close Magno's books.................................................................... Notes Payable......

................................300 12..........................................000 46.....800 4........................................... Total Assets. 2................................................................. Notes payable...............................................000 + P7..................000 300 12............. Allowance for Bad Debts (15% x P32........................................................................................... 4...................400 Cash (90% x P12...................... Other assets................ Loss from Sale of Office Equipment...000).................................................790 21............................... Lagman.......................000 8.......................................790 – P35..................................................000)....................000).............000 = P35.............790) 35..............................................800 Books of Ureta Ureta............... 10..........................000 P115..............................790 Liabilities and Capital Accounts payable.............790 Problem 1 – 6 1........................................................................000 __35.... Accrued interest payable....................................................... (P63.......800 1......................... Magno............... J...........................................210 – 32............................................................. capital.............................. Capital.................................... P 18.490 Partnership – Basic Considerations and Formation 4.. Goodwill .. Capital.................... Cash................... Allowance for Bad Debts (10% x P24............000 15....... Lagman........... Books of Toledo Toledo.................................................................790 23........................000 P115..........................000 ___8.........400 12............ Lagman.....490 35...... Office Equipment............................ Accounts payable to J...... Capital. Lagman.......................................................... ........... 17 Lagman and Magno Balance Sheet December 31. Total Liabilities and Capital. 2008 Assets Cash.....................................................200 2.000 1.........790 = P70............... capital..................000 ............................................................. Merchandise inventory.......................................................................... Equipment........................ Accounts Payable to J.......................... P P34............... R.................... Less Allowance for bad debts....................J. Accounts receivable....

..................................................................................400 – P300)............. Total agreed capital of the partnership............ Allowance for Bad Debts...... New Partnership Books Cash..... capital............................... 22. Merchandise.................................................................700 P 3....... Notes Payable......................................................................................................... ........................ Cash contribution of Ureta.......400 P 68....................................................... Accounts Payable.................................................. capital (P68............. 300 900 1........................... Less Ureta................................................. Accounts Receivable..................................100 __64.............700 P 3................................. Merchandise................................................................400 2...... Multiply by Ureta's profit share percentage...........................000 Cash................................................. Cash contribution of Ureta....................................................................................200 18 Chapter 1 2....................... Allowable for Bad Debts......... Capital......................................................... To record the investment of Ureta. Ureta....400 – P300)................ Agreed capital of Ureta... Ureta..................... Accounts Receivable................................................. Divide by Toledo's profit share percentage.......400 P 68............ Capital......................................................................................................... Accounts Payable.......................000 36..................... Capital...................................................................000 10........................................................................ Toledo..................................................................000 68........................................ To record the investment of Toledo...... 3...................................200)..........Toledo....................................................200 ____50% P 68.................... To record Ureta's cash contribution.................. ......... Capital..100 __64........... Capital (1/4 x P1..... 4....800 10................................100 ____50% P136..800 24................................. 3............... Capital.....400 16..................................... or Toledo...... Office Equipment.........................................................000 300 Cash........ Toledo....000 40... Ureta...........400 ................................. 3.................. Ureta....... Loss from Sale of Office Equipment......... capital....700 3.......000 2...................................400 Computation: Toledo.....200 32................. capital (P68...000 64.................

................... Toledo.........................................................100 P164.... P 26..........................................................................400 P56.............................................................................200 48............................................000 2................000 __7................... P 29..200 Liabilities and Capital Accounts payable................800 76.......................000 P164............................................................................................ Notes payable.......................... 2008 Assets Cash.......... Total Assets..................................................... Less Allowance for bad debts.................000 68...................................... Merchandise........................ Office equipment...........200 .... capital................................... 19 Toledo and Ureta Partnership Balance Sheet July 1..............Partnership – Basic Considerations and Formation 4.....................................................................000 __10....................................... Total Liabilities and Capital..... Ureta.......................100 __68........... Accounts receivable................................................... capital...........

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