2 4 2 2 8

MAHIRAP MADALI EASY BASIC

CAPITAL BEFORE ADMISSION 1,163,000 3,295,000 897,000 - 5,395,000
INVESTMENT - - - 645,000 645,000
WITHDRAWAL - 125,000 - 250,000 - 125,000 - - 500,000
BONUS TO D - 113,750 - 227,500 - 113,750 455,000 -
CAPITAL AFTER ADMISSION 924,250 2,817,500 658,250 1,100,000 5,500,000

QUESTION 1 Cash contributed by Basic?

QUESTION 2 Amount of Impairment loss in the admission of Basic?
QUESTION 3 Adjusted Capital of partner D mahirap?
QUESTION 4 Adjusted Capital of partner Madali?
QUESTION 5 Adjusted Capital of partner Easy?
QUESTION 6 Total amount of adjustments to old partners?

ANSWER 1 645,000
ANSWER 2 - 500,000
ANSWER 3 924,250
ANSWER 4 2,817,500
ANSWER 5 658,250
ANSWER 6 - 955,000
 PROBLEM
Subject: AFAR
Topic: Partnership Dissolution
(Adapted)

D mahirap, Madali, at Easy are partners with capital balance of P1,163,000, P3,295,000, and P897,000,
respectively, sharing profits and losses in the ratio of 2:4:2. Basic is admitted as a new partner bringing with
him expertise and is to invest cash for a 20% interest in the partnership which includes a credit of P455,000 for
bonus upon his admission. The asset of the partnership are overvalued upon admission of Basic so they adjusted
their total agreed capitalization to P5,500,000