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Write the letter of the correct answer on the last page of your examination papers. (3 Points each) PART A. NATURE OF PARTNERSHIPS 1. Which among the following is not a characteristic of a partnership?
a. Limited Life
b. Co-Ownership of Partner’s Properties c. Assignment of Partner’s Interest d. Unlimited Liability 2. Which among the following is not a requisite of a valid partnership? a. Mutual Agency among the partners b. Contribution of money, property and industry c. Income Participation among the partners d. A lawful purpose for which the partnership was organized 3. Which of the following is not an advantage of partnerships? a. Less Government supervision b. Joint resources c. Easy formation d. Mutual Agency 4. Which of the following is not a disadvantage of partnerships? a. Limited life b. Unlimited liability c. Consensual d. Joint resources
5. Which among the following distinctions between a sole proprietorship and a partnership is false?
a. A partnership is created primarily for profit while in a sole proprietorship, profit is merely incidental. b. A sole proprietorship has simple agency while a partnership has mutual agency.
c. A partnership is generally liable for corporate taxes while a sole proprietorship is not liable for
business taxes. d. A partnership has several capital accounts while a sole proprietorship has only one capital account.
Silent partner . Their industry and the properties’ usufruct are their actual contribution to this partnership. Universal partnership of profits b. A partnership has a separate and distinct personality from its owners while co-ownership has not separate personality. In partnerships. Which among the following is a wrong distinction between a partnership and a co-ownership? a. c. c. Ostensible partner c. Dormant partner b. consent is not required. a. A partnership has unlimited liability while a corporation has limited liability. there is power of succession. The rights of the partners are generally not transmissible while the rights of a co-owner are transmissible if there is a stipulation. d. Silent partner 10. consent is required to fully dispose partnership interest while in co-ownership. Ostensible partner c. d. there is no power of succession while in corporations. a. b.6. 9. Secret partner d. It is a partnership wherein partners retain ownership of the things that they have placed into the common fund. there is mutual agency while in corporations. 7. Particular partnership. This kind of partner is not known as a partner and inactive in the partnership. 8. Universal partnership of several properties d. b. a. This kind of partner is not known as a partner but is active in the management of the partnership. Which among the following distinctions between a partnership and a corporation is incorrect? a. there is corporate agency. A partnership is formed by the agreement of the parties while corporations are formed by operation of law and compliance with the requirements prescribed by law. Secret partner d. In partnerships. Co-ownership exists for the preservation of property while partnerships are created primarily for profit. Dormant partner b. Universal partnership of all present property c. In partnership.
000. 2013.000 k. P 300. On October 31. David and Enica are senior partners in a partnership.000 i. Paula and Andrei formed a partnership. Enica.000 b. 2012.000 d. 2012. P 120.000 15.000 l.000 c.000 d. P 120. P 40. P 30. Silent partner 12.000 j.000. P 70.000 f.000 h.000 i. P 70. On September 1. promises to contribute merchandise inventory which he purchased for P250. P 90. P 110.000 f. P 100. on the other hand. P 110. P 70.000 d.000 16. P 20. P 40. how much interest income should the partnership recognize as a result of the loans? a.000 b. P 30.. Silent partner PART B. P 90.000 i. P 40. How much additional cash should Andrei contribute to the partnership? a.000 Use the following data for items 14-17.000 but having a fair market value of P300.000. 2012. P 250. P 80. This kind of partner is known as a partner but is inactive in the management of the partnership.000 g. Ostensible partner c. Andrei. 14.000 j.000 k. P 60. P 110. PARTNERSHIP FORMATION 13. P 50. P 20. P 30.000 h.000 e.000. On December 31. on the other hand lent money in the amount of P1.000 d.000 l. They agreed that the total capital of the partnership shall be P1.000 g. Ostensible partner c.000 c. P 80. David borrowed from the partnership the amount of P1. P 120.000 e. P 60.000 k.000 .000 f. how much interest expense should be incurred by the partnership? a. how much interest income should be recognized by the partnership? a. Paula promises to contribute to the partnership cash amounting to forty percent (40%) of the partnership capital.000 c. Dormant partner b. Secret partner d. Dormant partner b. P 50.000 j.000 e. Secret partner d.000 and additional cash for sixty percent (60%) of the partnership capital. a. P 350. P 90. P 50. On December 31. P 20.11.000 b. P 400. P 60. P 100.000 g.000 to the partnership payable in six (6) months subject to interest of 12% per annum. On December 31. 2012.000 payable in nine (9) months with 12% interest per annum. A partner in name only by permitting the use of his name either for accommodation or for consideration. P 100. P 80.000 l.000 h. P 50.000 c. P 50.000 b. P 50. a.
1. Sena.000 e.000 o. How much is the net realizable value of the partnership’s accounts receivable after formation? a.000. How much is the net realizable value of the partnership’s notes receivable after formation? a.000 e.000 d.00 180. 1.000.000.000 d.000.00 Agreed Value 200.000.000.000 i.000 p. P 120.000.000 n. 600.00 150.00 200.000 l.000 i.00 450.000 j.000. They agreed that each partner shall be credited with one-third (1/4) of the partnership’s capital in exchange for each partners’ contribution which consists of ALL their business assets and liabilities plus additional cash to cover the deficiency.000 k.000 l.000 k.00 20. the records of their businesses show that Niel.400.000 f.000 b.00 250.000.00 550. 650.000 j. 500.00 300. 500.000 i.200. How much additional cash should Niel contribute to the partnership? a. 250.700.300.500.00 Agreed Value 200.000.00 200.000 19. P 30. P 50.000.000.000 m.00 250. 850.000.000 g.00 200.00 50.000. 700. 400.000 j.00 250.000 i. 2013.00 300. 1. 1.000 i.00 50. 1.000.000.800. 1. 550.000 20. P 20. 1. P 80.000.000.000.00 Book Value 200. On December 31.600.000 g.900.000 k.000. 350.000. 500.00 150.000 l.000 d.000 f. 100.000 l.000.800.00 200.000. how much interest expense should the partnership record as a result of the loans? a.000 .000.00 250.000. 300.000 h. 1. 1.00 200.000 c.000. 700.600.000 c.00 180.000 f. 2.400. Depreciation Accounts Payable Notes Payable Cash Accounts Receivable Allowance for Bad Debts Notes Receivable Equipment Acc.00 50.000.00 150.00 50. 1. 1.000 o. 750. 1.000.00 250.000.000.000 p.000 n.000.000. 1. 650.00 300.00 30.900.000. 1. 100. Depreciation Accounts Payable Notes Payable Book Value 200.000.000.00 250.00 250.000 o.000. As of the date of partnership formation.000.000. 450. 1.000 g.000.000 k.00 20.000 m.00 Ivan Fair Value 200.000 b.300. 400.00 50.00 50. They agreed that that the total capitalization of the partnership shall be P4.000.000 g.00 500.00 550. P 110.000.000 k.000.000 22.00 50.000 n. Sena and Jhed own the following properties: Book Value 200.00 200.000 b.00 30.000 21.000 p.00 500.000.500.00 300. 800.000 e.000. 2.00 350.000 c. 1.00 500.000. P 40.000.000 m.000. 1.000.000. 600. 900.000 i.00 50. 750.000.000.000 b.000 f.00 30.000 o.00 20.000 h.000.000.000. Ivan and Jhed.00 200.00 Cash Accounts Receivable Allowance for Bad Debts Notes Receivable Equipment Acc.000.000 h.000.17.000.00 550.000 k.00 200.000 f.00 550.000 d.000.100.00 30.000 j.00 350. 1.00 Sena Fair Value 200. 900. 1. 600. P 70.00 200.000.000 o.00 180. 800.00 250.000.00 300.00 200.00 450.00 300. 450.000 e.000 p.000.000.100.000 e.700.000 n. 1. P 90.800.00 450. sole proprietors.000.000. 600.000 e. 600.000. P 100. 700.000.00 Niel Fair Value 200.000.000 l. 1.000.000 c.00 300. How much is the net book value of the partnership’s equipment after formation? a.00 350. 350.000.400.000.000 Use the following data for items 18-25.000.00 500.000 j. 200. 800.000.000 m.00 Agreed Value 200.00 180.00 20.500. 1.100. P 50.000.000.000 h.000.00 Book Value 200. 700. 250. 150. P 60.000.00 200.000.000.000.000.700.00 450.00 250. 850.000 h.000 j.00 350. 150. 1.00 Agreed Value 200.000 d.00 250.000 n.300. 1. 1.000.200. 900. 700.000 g. 1.00 200.00 250.000 f. How much is the total amount of cash that Sena will be contributing to the partnership? a. 1.000.000 c.000 c.900.000.00 200.00 200.000.000.000 b. 300. Niel.00 200.000 m. 800.00 250. 550. 200.00 150.000 b.00 18.000.000.000.000. 500.000.000.000. 500.000 g.00 300.000.00 200. 1.000.000.00 Jhed Fair Value 200. decided to form a partnership.
000 Required: Compute the following : Case 1: Profit distribution if the partnership has a net income of P2.000 i.000. 1. 1. 1. 1. 900.000 m.000 p.200. how much is Paul entitled to receive during profit distribution? a.000 o. 1.000 p.000 23.600. 1.000 P400. 26.000 c.052.000 b. 900.400.600.400.000 27.000 o. 1.000 d.300.200.000 j.000 n. 1.200.000 29.000. 1.000 f.000 c.500.000 d. How much would be the total cash of the partnership after formation? a.000 c. how much is Paul entitled to receive during profit distribution? a. 1. 1. 800.000 06/30 P200.000 b. 1.000 l. 1.000 h.200. 2.857 .400. 600. 1.000 b.300. 1.600. 1.000 Paul. 500. 1.000 g.000 P300. 700.000 c.800.000 m.400.000 m.000 b.200. 1. 700. 1.000 f. 800. 1. 800.000 c.000 25.000 p.000 i.000 d. PARTNERSHIP OPERATIONS Use the following data for items 26-31 Paul and Peter formed a partnership. Capital 01/01 07/31 P200.000.000 d. 2. 2.700.000 l.300.000.900.000 k. 857. 600.500.000 n. 600.142.143 947.800. 1. 1.000. 1.000.000 l.632 b.800.000 h.000 P500. Assuming that the partners agreed to distribute profits and losses according to the beginning balances of their capital.000 k. Assuming that the partners agreed to distribute profits and losses according to their ending capital balances. c.000 e.000 28. Capital 01/01 06/30 09/30 Peter.000 e.000.200. How much would be the total liabilities of the partnership after formation? a.400. Assuming that the partner agreed to distribute profits equally.000 j.000 g.400. 1.000 f. how much is Peter entitled to receive during profit distribution? a.000 e. 2. 1. 1. 1. 1.000 k.900.000 o.000. 1.000 d. 1.600. 1. 1.000 b. 1.000. 1.000 d.000 b. how much is Paul entitled to receive during profit distribution? a. 500. Assuming that the partners agreed to distribute losses according to the their profit and loss ratio of 3:2 for Paul and Peter respectively. 1. Show your computations. 1.000 PART C-A.000. 800.000 h. How much would be the total capital of Jhed after partnership formation? a.d. 1. The partners’ capital balances during the year are as follows: 03/31 P100. 1.000 24. 500. 800.000 p.100.000. 1.200.000 c.000 l. 1.368 d. 900. 800. 700.700. 800.000 h. 1.000 i.100.900.000 g.000 n.000.000 j. 1.700. 1.000 P300.500.100.
632 b. how much is Peter entitled to receive during profit distribution? a. Assuming that the partners agreed to distribute profits and losses according to their simple average capital balances.143 947.000.857 31. 857. Prepare a detailed computation showing how you arrived with your answer. 1.30.142. 1. BONUS: (5 Points) Give the journal entry to distribute the net income in the amount of P 3. . d. (10 POINTS) Compute for the weighted average balances of Paul and Peter’s capital accounts.000 to Paul and Peter on the basis of their weighted average capital balances.368 c.052.
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