You are on page 1of 10

SAN BEDA COLLEGE

Mendiola, Manila

ACCOUNTING REVIEW PROF. ROEL E. HERMOSILLA

PARTNERSHIP FORMATION

PROBLEMS
1. On May 1, 2016, the business assets and liabilities of Emma and Liam were as follows:

Emma Liam
Cash P 8,000 P 62,000
Receivables 200,000 600,000
Inventories 120,000 200,000
Land, Building and Equipment 650,000 535,000
Other Assets 2,000 3,000
Accounts payable (180,000) (250,000)

Emma and Liam agreed to form a partnership by contributing their net assets, subject to the
following adjustments:
 Receivables of P 20,000 in Emma’s books and P 40,000 in Liam’s books are uncollectible.
 Inventories of P 6,000 and P 7,000 in the respective books of Emma and Liam are
worthless
 Other assets in both books are written of

Upon the partnership’s formation:
The respective capital of partners Emma and Liam would be ___________ ; ____________ .
The total assets of the partnership would be _______________ .

2. Noah admits Olivia as a partner in business. Accounts in the ledger of Noah on June 1, 2016,
just before the admission of Olivia, show the following balances:

Cash P 26,000 Accounts Payable P 264,000
Accounts Receivable 120,000 Noah, Capital 62,000
Merchandise Inventory 180,000

It is agreed that for purposes of establishing Noah’s interest, the following adjustments should
be made:
a. An allowance for doubtful accounts of 2% of accounts receivable is to be
established.
b. The merchandise inventory is to be valued at P202,000.
c. Prepaid expenses of P6,500 and accrued expenses of P4,000 are to be
established.

Olivia is to invest sufficient funds in order to receive a 1/3 interest in the
partnership.
a. How much is the adjusted capital of Noah?
b. How much cash should Olivia invest?
c. How much is the total assets of the partnership.
d. Journal entries in the books of the new partnership.

3. The balance sheet as of July 31, 2016, for the business owned by Ethan, shows the following
assets and liabilities:

Cash P100,000 Fixtures P328,000
Accounts Receivable 268,000 Accounts Payable 57,600
Merchandise 440,000

It is estimated that 5% of the receivable will prove uncollectible. The cash balance includes
1,000 share certificates of PNB at its cost, P8,000; the stock last sold on the market at P70.00
per share. Merchandise includes obsolete items costing P36,000 that will probably realize only
P8,000. Depreciation has never been recorded; the fixtures are 2 years old, have an estimated
life of 10 years, and would cost P480,000 if purchased new currently. Sundry prepaid items
amount to P10,000. Ava is to be admitted as a partner upon investing P400,000 cash and
P200,000 merchandise.

000. PAGE 2 What will be the total capital after the formation of the partnership? 4.000 330. respectively.00 0 On this date.520 The cash balance included a 200.000. has a remaining useful life of about eight more years.000 cash and delivery equipment that cost P40. Capital 133.000 Payable Accounts Receivable 92. The balance sheet of the proprietorship of Jacob as of June 30. the current market quotation is 70 per share. the equipment. Emily and Bert will join Jacob in a partnership.600 Inventory 88. How much cash Lucas should contribute? 2.000 Equipment 65. Emily’ cash investment would be: 2 . Isabella. An allowance for possible uncollectibles of P4. Journal entries to efect the above transactions? 5.500 is to be established b. Jackson contributes furniture that cost P60. How will you state the settlement between Logan and Isabella? 3. Depreciation has not been recorded. an estimated 5% is considered to be doubtful of collection.000 and has a fair value of P30. Accrued expenses of P4. and Lucas will divide profits in the ratio of 5:3:2. are currently worth P 16.000 Accounts 89.000 Logan.000 d. Jacob will invest the net assets of his business. Prepaid expense of P 12.120 have not been properly recognized. The terms of the agreement is that assets and liabilities are to be restated as follows: a.000 Isabella. booked at a cost of P 22. Of the accounts receivable. Capital balances for the new partners are to be in this ratio with Logan and Isabella making cash settlement outside of the partnership for the required capital adjustment between themselves and Lucas investing cash in the partnership for his interest. 6.800 and accrued expense of P 6. after efecting the appropriate adjustments.000.960. acquired two years ago.00 0 Inventory 165.000 are to be recognized Logan. The partners agree to share profits and losses 60% to Jackson and 40% to Charlotte.600 Accounts Payable 63.000 c. Inventories are to be restated at their present replacement values of P170.600. Jackson and Charlotte establish a partnership to operate a used-furniture business under the name of F & D Furniture.00 Capital 0 Equipment 70. Equipment are to be restated at a value of P35.000) depreciation 330.000 Accumulated (45. 2016 shows the following: Cash 48.share certificate of BW Resources common at acquisition cost of P 1. 108. Logan and Isabella are partners sharing profits 60:40. Questions: 1. A balance sheet prepared for the partnership on April 1. Certain inventory items. and he will be allowed credit for goodwill equal to 10% of his initial capital credit.000 Accounts Receivable 53. Charlotte contributes P30.000 and has a fair value of P90. a. Emily and Bert will each contribute cash to secure the respective interests of 1/3 and 1/6. Calculate the peso amount of inequity that will result if the initial noncash contributions of the partners are recorded at cost rather than fair market value. the partners agree to admit Lucas as a partner. Jacob’s goodwill credit would be: b. 2016 showed the following assets and liabilities: Cash P 40.

00 0 September 1 20.600 a year.  The partners will be allowed with interest equal to 10% of the capital balances as of the first day of the year. The following account balances appear in the ledger for the firm of X and Y at the end of 2016 before the profit for the year has been transferred to the partners’ accounts: X. capital. and the balance in the ratio of beginning capital balances. A salary Audrey of P24.00 0 March 1 P10. Assume that the net loss for the first year of operations is P 2.000. computed before salaries. and the balance is divided equally Audrey. Salaries allowed to GABRIEL and AUDREY in the amounts of P34.600 to C.000 Y. The following entries were made in their capital accounts during 2016: Debit Credit GABRIEL.000 is allowed to AUDREY.  A will be allowed a bonus of 10% of the net income after bonus  The remainder will be divided on the basis of the beginning capital for the first year and equally for the second year  Each partner is allowed to withdraw up to P 1. capital P 32.400 with net income of P 8.200 and P 1.000 AUDREY.000 is to be credited to AUDREY. a salary Audrey of P16. capital 16. and remaining profits and losses are shared equally Audrey (the bonus is regarded as an expense for purposes of calculating the bonus amount).00 0 October 1 10.000 November 1 10.000 Required: If the partnership net income.000 According to the partnership agreement . January Audrey 1 P60.800 in the following year. 2016. respectively Audrey.000 and P38. A bonus of 10% of partnership net income is credited to GABRIEL.000 3 . c.0 00 April 1 P50. GABRIEL and AUDREY organized the Levin Partnership on January Audrey 1.000 for 2016. interest or bonus is P56. Interest at 4% is allowed on average capital investments. indicate its division between the partners under each of the following independent profit- sharing agreements: a. drawing 125.000 C. Assume further that each partner withdraws the maximum among from the business each period. all profits will be distributed as follows:  A will be allowed a monthly salary of P 3. What is the balance of A’s capital account at the end of the second year? 3. 4% interest is allowed on each partner on his ending capital balance. d. PAGE 3 PARTNERSHIP OPERATIONS PROBLEMS 1. capital: January Audrey 1 P180. drawing P 72. and remaining profits and losses are divided in the ratio of average capital balances. b. 2. AC Partnership begins its first year of operations with the following capital balances: A.

interest and bonus is P13.000 Profit and loss 302. A. capital 95. C is to receive a salary of P100. In 2016 it is ascertained that in calculating net income for the year ended December 31. 5. respectively. 2016. Matthew’s share on the profit after salaries. In addition.000 per annum. in order that C may receive an aggregate of P250. capital 500. The installation relates to equipment with a 10-year life.000. loan P175. The partnership agreement provides that each partner shall receive 5%interest on the amount of his capital contribution.000 and P60.000 ________ Matthew. B. Scarlett’s total share in the net income is P 21.000 and ending inventory was understated by P8. agree to form a partnership and to share profits in the ratio 5:3:2. 35% to Scarlett and 40% to Scarlett The partnership began its operations on October 1. before any charge for interest on capital or partners’ salaries. to B?.000. is entitled to a special bonus of 25% of the net profit after deduction of all special allowances to partners (including the bonus). 4.688. The bonus to C is P 5. Actual withdrawals by partners difered from allowed amounts and are summarized in the drawing accounts. 31 ending capital balance of each partner? 4.000 Joshua. C. Capital contributions were as follows: C. C. income from fees are P900. and S. Profits of P90.P1. How much of the profit should be credited to A?.000.000. which is 6% and is to be paid to X at the time the loan is repaid. Y.20%.000 were reported for the year 2015. During the first year of operations.804 B.000 as his share of the profits. The loan to the firm was made by X on March 1. ASSETS LIABILITIES & CAPITAL Cash P 100. Which of the following is true? A.P500.500 The following information is to be considered in closing the profit and loss account and the drawing accounts: 1. Calculate the amount that must be earned by the partnership during 2016.500.P500. salary and share of profits.000 Liabilities P 200. P.500 and P2. capital 120. A.000. 2016.250. which are to be charged as expenses of the business. doctors.30%. a) How much should be the share of each partner in the NI? b) How much should be the Dec.000. interest and bonus is P 38.00 0 X.000 Total Liabilities and 500. 4 .000 Capital The partners agreed to distribute profits as follows: 1) Annual salaries to Joshua and Scarlett of P 5. A. and S- 20%.000.000 each 2) Annual interest of 5% on beginning capital 3) Bonus of 15% to C based on income after salaries. the entire profit is to be divided in the salary ratio. the managing partner. 2. The agreement further provides that A shall receive a minimum of P50.543. 7. Scarlett and Matthew were taken from the books on October 1.696. with four partners. capital 85.000. 2016 is P 69. 2015. these amounts to be regarded as salaries. and any remaining profit is to be distributed equally.000. while expenses total P480. 3. The Gulp Co.000 and that B is to be guaranteed P105.000. The partnership agreement permits X and Y to withdraw weekly sums of P1. both including amounts allowed as interest on capital and their respective shares of profits.000 Other Assets 400.000. D. The following Balance Sheet for the partnership of Joshua. A. No entry has been made for interest on the loan.000. PAGE 4 X. if profits are not adequate to meet the salary allowances. Partners L and M share profits 3:1 after annual salary allowances of P40. The balance of the profits to be shared in the following proportions: C. and C. The cost of installing equipment at the beginning of 2016.000 Total Assets P 500. and S- P400.30%.000 and P a salary of P60. capital 500. including interest. P27. a partnership was formed on January 1.000 Y. was charged to expense. respectively.. to C? 6.000 Scarlett. however. 2016 and net income as of December 31.000 per annum from the partnership and S a minimum of P120. a) What adjustments should be made on the capital of L and M? b) Adjusting entry needed to correct the partner’s capital balances. Net Income after salaries. They also agreed that C is to be allowed a salary of P140. P. depreciation was overstated by P36. interest and bonus 4) Remaining profit: 25% to Joshua. 2016. P.

Rachel and Cecilia began the year with a capital balance of P81.000 BB. Assuming that DD would invest P55.000. 2016 appear below: Sales P600. 15 percent and 25 percent for AA. 2015.000 Less: Operating expenses 60. Throughout 2016. appears below: Assets: Liabilities and Capital: Cash P 15. The share of Rachel and Cecilia on the net income: b. 2016 the partners agree to admit Ruth into the partnership for a 25% interest in capital and earnings for his investment in the partnership of P120.000 P200.000 Liabilities P50. Capital (50%) 75. the partnership net assets are to be revalued. 22-1/2 percent. Residual (if negative) 50% 50% a. each partner withdrew P800 per week in anticipation of partnership net income.000 On January 1.000 into the partnership and on August 1. Nimrod. Capital balances and profit sharing percentages for the partnership of Aaron. 31. The income statement of Rachel-Cecilia Partnership for the year ended Dec.000 CC. CC and DD respectively. On April 1. Assuming that DD would purchase one-fourth of each of the partner's capital and rights to future profits by paying a total of P45.000 Accrued Liabilities 40.000 directly to the partners. Nimrod. BB. How much capital is to be credited to DD? 2.600 and P224.000 Other assets 185. Assuming that DD would purchase one-half of AA's capital and right to future profits directly from AA for P60. Nimrod . Elijah and Ruth. Residual (if positive) 70% 30% 5.000 Accounts Payable P 35.000 P200. Partnership assets are not to be revalued. A condensed balance sheet for the AA. if old partners will share profits using the old ratio? 3.000 Accounts Receivable (net) 45. The ending capital balance of Cecilia: CHANGES IN PARTNERSHIP PROBLEMS 1. 2016 are as follows: Aaron (36%) P140. and Elijah on January 1. 2015.000 On January 3. The partners agreed that these withdrawals are not to be included in the computation of average capital balances for purposes of income distributions. The capital balances of Aaron.000.000 5 . Cecilia invested an additional P40.000 Nimrod (24%) 100.000 Net income P160. Partnership net assets are not to be revalued. The balance sheet of the Dylan and Samuel Partnership at December 31. Rachel invested an additional P30. Capital (20%) 25.000 cash in the partnership for a 25 percent interest in capital.000 Gross profit 220.000 4. Interest on average capital balances 6% 6% 2. Capital (30%) 50. BB and CC partnership at December 31. and their profit and loss sharing percentages on that date are as follows: Cash P 15.000 Less: Cost of goods sold 380. 2016 the partners decided to bring DD into the partnership under the following independent assumptions: Questions: a. respectively.000 P 60. how much capital is to be credited to DD? b. Salaries P 50.000 into the partnership. PAGE 5 8. a. immediately after the admission of Ruth would be: b. 3.000 AA. Future profits would be divided 37-1/2 percent. What will be new profit and loss ratio for Aaron.000 Elijah (40%) 160. How much will be the capital balance of BB after DD's admission? c.000 Notes Payable 25.000 Additional information: 1. Rachel and Cecilia have agreed to distribute partnership net income according to the following: Rachel Cecilia 1.000. Bonus on net income before the bonus but after interest on average capital balances 10% 3. Elijah and Ruth. 2.000 Inventories 75.

000 Dylan. 2016. which method (goodwill or bonus) will benefit I. The partners agree that H is to take certain furniture and fixtures at their secondhand value of P12. Sebastian acquired 25 percent interest in capital by investing P80. regarding H's taking of furniture and fixtures at their second hand value of P12.000. and N are partners sharing profits in the ratio of 3:2:1.750 directly to Dylan and P31. and how much? b. and Mortgage Payable 110. how much are the capital balances of L and M after N's withdrawal? b. P and Q share profits in the ratio of 5:3:2. capital 70. Assume that I is allowed a 40 percent interest in the firm. How much is the note payable issued to H? b.000 Samuel. 2015. Determine the capital balance of Sebastian immediately after his admission.250 directly to Samuel. How much must be the capital balance of Dylan immediately after the admission of Sebastian? b.000 and P48. Determine the capital balance of Dylan.000. plant. Plant. Using the goodwill approach.000.000 Payable to P 30. Questions: a.00 O.000 on December 31.000 for N's interest. M. while property.000. Capital 90. P300. which method (goodwill or bonus) will benefit I. I is admitted as a partner upon investing cash of P50. Total capital of the Dylan-Samuel-Sebastian Partnership on January 1. respectively.000 P360. Profits after the withdrawal of Q are to be shared 3:2. Questions: a.000 Other assets 190.000 P360. Total capital of the Dylan-Samuel-Sebastian Partnership after Sebastian’s admission amounted to P320. P300. how much are the capital balances of L and M after N's withdrawal? 7. The fair value of the inventories was P85.000 Goodwill 80. Sebastian paid P18. and equipment (net) had a fair value of P265. d. capital 40. Using the bonus approach.000 and a note for the balance of her interest. 2016. and G. when N decides to withdraw. Samuel and Sebastian immediately after Sebastian’s admission. It is agreed to pay P300. L. inventories had a fair value of P85. G and H are partners with capital balances on June 30. 2016.000 and who share profits in the ratio of 3:2. S is permitted to withdraw from the firm on December 31.000 Liabilities P80. Profits are shared equally. H withdraws from the partnership. of P300. Is there an efect on the capital accounts of F. (net) 225.00 P280.000 Q. Capital accounts are P500. 4. respectively.000 of cash into the partnership.000 on January 1. 2016. and how much? 5.000 P280. capital 60.000 and the fair value of the property. Questions: a. Assume that I is allowed a 25 percent interest in the firm.000 and P200.000? 6.000 0 P. Sebastian acquired a 25 percent interest in capital by investing P50.000 after the admission of Sebastian.000 6 . At January 1. Profits after the withdrawal of N are to be shared equally. F. O.000.000 Equipment.000. Determine the capital balance of Samuel immediately after the admission of Sebastian. Capital 60.000. and equipment (net) was P305.000.000 of cash into the partnership. I and H are partners who have capitals of P60. Both Dylan and Samuel decided to revalue the partnership’s assets before the admission of Sebastian. Sebastian acquired a 25 percent interest in partnership capital directly from Dylan and Samuel for P50. c. The furniture and fixtures are carried on the books as fully depreciated. Assume the same facts as in a except that total assets of the partnership were P410.000 with profits to be shared equally. amounted to P200.000 and P200. PAGE 6 Property.000 Determine the capital balances of partners immediately after the admission of Sebastian under the following independent situations: a. plant. The partnership balance sheet on this date is as follows: Receivable from Q P10. Total assets of the partnership after the admission of Sebastian were P360.000. 2016.

Using the program developed above.000. Loan 2. he accepts securities.000 Other Assets 46. A. how much are the capital balances of O and P after Q's withdrawal? b. which method is preferred by GAAP in recording Q's withdrawal and why? d. how much are the capital balances of O and P after Q's retirement? c.000 Goodwill 9.000 E. Current assets before Philip’s retirement must be: b. respectively. Capital 12. Capital 14. Using the data in question A. A balance sheet prepared on this date follows: DEF Partnership Balance Sheet As of December 31.000 March 80.000. it is decided that Philip shall receive only one-third of his adjusted capital credit in cash. how much are the capital balances of O and P after Q's withdrawal? f. and C are partners sharing profits in the ratio of 5:3:2.000 in full settlement of the capital interest and P10.000. Other assets before Philip’s retirement must be: e.000 P 47. which method is preferable by GAAP? And why? 8. PAGE 7 0 Questions: a. partners sharing profits in the ratio of 60% and 40% wants to retire.000 claim balance. Assuming that Q is paid P24.000 6. Loan 5. Using the data in question d. In relation to d and e.500 D. Fixed assets before Philip’s retirement must be: d.000 Loan Balances 43.000 Required: a. Since the working capital is only P70. Current liabilities before Philip’s retirement must be: c.000 Current liabilities P 52.000 February 50.000. using the goodwill method of recording Q's withdrawal. On December 31.000 Romy. D. A balance sheet prepared just prior to partnership liquidation shows the following: A B C Capital Balances P122. prepare a schedule summarizing the payments to be made to partners at the end of each month. 2016. which have been carried as other assets at their book value and market value of P12.550 7 .000 Liabilities P 6.000 Other assets 3.000 48. using the goodwill method. E and F are partners sharing profits in the ratio of 40:35:25.000 in full settlement of the capital interest and P10. how much are the capital balances of O and P after withdrawal of Q? e.000 P102.000 April (final distribution) 20. b.000 P 72.000 - P102. which is then prepared. using the bonus method of recording the withdrawal of Q. Prepare a program to show how cash is to be distributed during the entire course of liquidation. Assuming that Q is paid P44. of Philip and Romy. In relation to A & B.000 Assets are sold and cash is distributed to partners in monthly installments during the course of liquidation as follows: January P20. For the remainder. that goodwill is worth P15. respectively. The balance sheet. and that Philip’s share of these increases shall be recorded and creditable to his capital account. and a six-month note payable. The partners agree that the fixed assets are undervalued by P20. 2.000 claim balance. appears as follows: Current assets P 53.000 F. capital 50.000 Fixed assets 37.000 Questions: a. 2016 Cash P 2. B. using the bonus method. Philip’s adjusted capital balance must be: PARTNERSHIP LIQUIDATION PROBLEMS 1. Philip. they agree to liquidate.450 E.

000 and P100. the transfer being made at an agreed value of P40.500 P48. Capital 7.000 600 500 --- April 12. How much is the total cash received by K? c.000 Partners share profits equally after the allowance of a salary to Y. is distributed at the end of each month.000 Y.000 P48. On November 1.000. and proper settlement is made among partners the same day.000 P30.000 10. 3. a.225.500 7.000 400 --.000 February. no other cash payments had been made to partners.500 monthly.000 March 15. capital 200. capital ___200.000 _________ X.000 P1. P200. Profits and losses are to be shared in the ratio 2:1:1.250 0 2. 8 . for J.0000 750 0 1. respectively. W advanced P150.000 Profit and loss ratio is 3:2:1. Balance sheet data for the firm of W. How much is the total loss to J? b.000 4.500 K. Y. Partnership assets realized P50. capital 200.00 P10.000 W. The balance sheet of J. How much cash should W received in the distribution of P200.300 Cash is distributed as assets are realized.000 J.225.000 L. How much cash does L receive in January? 4. January P12. Required: Determine the share of each partner every month of distribution.500 11. P100. and L. and Y as of January 1. the members decided to liquidate. Show the final cash settlement among partners. Loan 2. Capital 12.000 P1. 2016 P 8. Z. it was agreed that he would be allowed interest at 6%. X. 2016. Available cash was distributed on November 1 and the firm was declared dissolved. Y had withdrawn his salary for January and February but had not received his salary for the period March 1 to November 1. 2016. and X form a form a partnership on January 1. It is agreed that 6% (1/2 of 1% per month) is to be charged on withdrawals that decrease capital below the original investments. Z withdraws P50.000 Liabilities P 5.respectively.000 P 9. PAGE 8 F.000 P30. Questions: a. 2016. 2016 12.000 cash available? 5.225. K and L Partnership shows the following information as of December 31. --- All cash available. Capital 7. Y agreed to take over partnership equipment in part settlement of his interest.000 cash was available for distribution to partners after sale of remaining assets and payment of partnership obligations to outsiders. investing P150.000. K.700 March. follow: Assets P1.000 to the firm on April 1. 2016 3.000.50 P500 P2.500 J. As a result of operation losses sustained at the beginning of 2016. Capital 3.000 Other Assets 28.000 and the accountant distributes this cash to the proper parties on November 1.000 Liabilities P 675.000 The results of liquidation are summarized below: Book Cash Expense Cash W/held at Liability Value Realiz s of end of month paid Realization ed Realizati for estd. All parties are solvent. Future s on exps. 2016: Cash P 2. With continued losses. respectively. How much is the total liquidation loss? b.00 P4. On March 1. Business is unsatisfactory and it is decided to dissolve partnership. the managing partner.00 February 7. Other assets were realized as follows: Date Cash Received Book Value January. except the amount withheld for future expenses. of P7.000.0000 6.

Capital (40%) (90. Prior to dissolution. 2016 are: Personal assets Personal liabilities B P 80. P40.000 Ross. Capital (30%) 10. Rosa received P 50.000 40.000 Loan to Ross 40. Daniel.000. 2015 contains the following accounts and balances: Cash P 240.250 If in the first distribution. Capital (20%) 141.000 P 45. A balance sheet of the partnership at December 31. The amount recovered by Sol from Taz is: a.000 50. and cash is distributed. The accounts of the partnership of Lora. PAGE 9 6. and the partners settle their claims against each other.000 9 .000 61. the condensed balance sheet together with the profit and loss sharing ratio was derived as follows: Cash P 100.000 Rose. the vulnerability ranks (1 is most vulnerable) for Daniel. Capital 340. Lora received an amount equal to P 187. capital (40%) (100.000 contingency balance is to be distributed at the end of each month until the liquidation is complete.000 In January. and the account balances after all noncash assets are converted to cash on November 1.000 b.250 Liabilities 262.000 d.000 Taz. Capital 200.000 Daniel.500 C.000 partnership equity would appear to be recoverable? 8. capital (30%) 90. should receive: b.000 to the partnership to provide cash to pay the creditors. If a cash distribution plan is developed as of January 1.000.000 Inventories 400. capital (50%) 136. and Ross.000 are sold for P200.000 O. 2016. D. what amount of R’s P90. Total amount realized from the non – cash assets is P 598.000 Equipment (net) 300. capital (30%) 266.000 Loan from Keith 20. are: Cash P 50.000 P 50. and all cash on hand except for P20. O and Y was dissolved on October 30.000) Personal assets and liabilities of the partners at November 1. and Ross is to be liquidated as soon as possible after December 31. and Ross.500 Lora.000 Liabilities P 750.000 P 90.000 is collected on account. P60. 2016. Capital (30%) 60. 30%.250 B. Diana.000 Accounts Payable P 300.000 Accounts payable P120. Profits and losses are shared 50%. and Ross is: 9. along with residual profit and loss sharing ratios.000) Y. inventory items that cost P160.000 Keith. Anthony. Total amount distributed to partners is P 336. The partnership of Daniel. The partnership of B.000 Goodwill 40.500. 2016.000 c. 2016 are as follows: Cash P 103. and Scarlett were partners who decided to liquidate the afairs of the partnership.400.000 Land 100. If available cash is distributed on January 31. respectively. Keith. Keith.000 P 1.000 Notes Payable 200.000) 100. Elizabeth. 2015.000 O 100. 7. and 20% to Daniel. which of the following is incorrect? A. respectively.500 Joaquin.000 Sol. 2016.000 B.250 Loan to Lora 15.000 If Y contributed P70.000 10.400. P 55. capital (30%) (60. After all partnership assets were converted into cash and all available cash were distributed to creditors.750 Loan from Rosa P 20.000 Other Non cash assets 707.000 40.000 P1.000 80. the loan to Ross was ofset against his capital balance and the goodwill is written of.000 Accounts Receivable 280. Total amount paid to creditors is P 262.000 The partnership creditors proceed against Taz for recovery of their claims.000 Y 100. a. Capital 340. 2016.750. the following were determined: Ledger Balances Personal Assets Personal Liabilities Accounts Payable P 20. Keith. P45. Rosa and Joaquin at the end of its fiscal year on November 30. Keith. P200.000 Rosa.

000 Scarlett. The cash received by Scarlett will be applied: Reh/cde 10 .900.800.000 Diana.000 The other assets were sold for P1. Payments were made to creditors and final distributions of cash were made to partners.000 Elizabeth.900. capital (30%) 315.000 Diana. The partner who got paid the most was: b. a. PAGE 10 Other assets 1.000 P1. loan 50. capital (30%) 420. loan 60.200.000 Scarlett.000 Anthony. capital (20%) 100.000 P 1. capital (20%) 205.000.