Name:JOHN MARK PALAPUZ CASE 2.

3 Bonus Method
Course, Year & Section:BSAC III
a.)
Total Capital of costing parties 4,000,000
CASE 1.1 Purchase of Interest from one Partner
Contribution of See 800,000
Eye, Capital 750,000 Total Capital of new partnership 4,800,000
See, Capital 750,000 Interest Ratio of See x20%
Credit to See’s Capital 960,000

CASE 1.2 Purchase of Interest from more than one

partner b.)

a.) Eye, Capital (1,500,000-64,000) 1,436,000

Eye Capital 320,000 Bee, Capital (2,500,000-96,000) 2,404,000
Bee, Capital 480,000 See, Capital 960,000
See, Capital 800,000 Total Capital of New Partnership 4,800,000

b.)
Eye Bee See Total c.) P/L Ratio
Capital Beg. 1,500,000 2,500,000 - 4,000,000 Eye, Capital (100%-20%)x40% 32%
Sale of Interest to see (320,000) (480,000) 800,000 - Bee, Capital (100%-20%)x60% 48%
Capital Ending 1,180,000 2,020,000 4,000,000 See, Capital 20%
100%

c.) Zero because no gain or loss is recognized in the partnership’s

books when a new partner is admitted.

d.)
Eye Bee Total
Debit to Capital account 300,000 500,000 800,000
Excess allocated based on
P/L ratio (1M-800K) =200K
200,000x40% 80,000
200,000x60% 120,000 200,000
Share of the payment of See 380,000 620,000 1,000,000
Debit to Capital Account (320,000) (480,000) 800,000
Personal gain (loss) 80,000 120,000 200,000

CASE 1.3 Purchase of Interest-Revaluation

a.)
Equipment 500,000
A, Capital (500Kx50%) 200,000
B, Capital (500Kx50%) 300,000

b.) A B See Total

Adj. Capital before 1,300,000 2,200,000 - 4,000,000
Admission
Share Revaluation 200,000 300,000 - 500,000
Credit - - 800,000 800,000
Debit (320,000) (480,000) - (800,000)
Capital Ending 1,180,000 2,020,000 800,000 4,000,000

CASE 2.1 Investment in the Partnership

a.)
Cash 1,000,000
See, Capital 1,000,000
b.)
Cash 1,000,000
See, Capital 800,000
Eye, Capital 80,000
Bee, Capital 120,000

c.)
Cash 1,000,000
Eye, Capital 120,000
Bee, Capital 180,000
See, Capital 1,300,000

CASE 2.2 Amount of Investment

a.)
Cash 1,000,000
See, Capital 1,000,000