PDF Chapter 2 Sol Man BAYSA 2008

1
CHAPTER 2
Partnership Dissolution
EXERCISES
Exercise 2 – 1
1. Sales, Capital 140,000

Rosales, Capital 140,000
2. P280,000 + P320,000 + P200,000 = P800,000
Exercise 2 –2
1. Total capital (P3,000,000 / 80%) P3,750,000

Capital interest of Fidel x 20%
Cash to be contributed by Fidel P 750,000
2. Cash 750,000
Fidel, Capital 750,000
Exercise 2 – 3
1.
Centeno, Capital 40,000
Corales, Capital 40,000
2.
Other Assets 80,000
Cortes, Capital 50,000
Claudio, Capital 10,000
P140,000/ ¼ = P560,000 – (P200,000 + P 160,000 +
P120,000)
Cortes, Capital P200,000 + P50,000 x 1/4 62,500

Centeno, Capital P160,000 + P20,000 x 1/4 45,000
Claudio, Capital P120,000 + P10,000 x 1/4 32,500
3.
Cash 230,000
Cortez, Capital 32,812
Claudio, Capital 6,563
AC CC Bonus_
old (3/4) P532,500 P480,000 P52,500
new (1/4) 177500 230,000 (52,500)
P710,000 P710,000 P---0---
AA 1 - Chapter 2 (2008 edition) page 2
Exercise 2 – 4
1.
Conde, Capital 90,000
Cuenco, Capital 60,000
Catral, Capital 150,000
2.
Other Assets 360,000
Conde, Capital P270,000 + 270,000 x 1/3 180,000

Cuenco, Capital P180,000 + P90,000 x 1/3 90,000
3.
Cash 270,000
AC CC Bonus_
old (3/4) P540,000 P450,000 P90,000
new (1/4) 180,000 270,000 (90,000)
P720,000 P720,000 P---0---
4.
Cash 270,000
AC CC Asset Re
old (3/4) P 810,000 P450,000 P360,000
new (1/4) 270,000 270,000
P1,080,000 P720,000 P360,000
5.
Cash 270,000
Exercise 2-5
1a. Bonus Method
Cash 180,000
Alba, Capital 6,000
Medel, Capital 9,000
Almeda, Capital 195,000
AC CC Bonus_
old (3/4) P585,000 P600,000 P(15,000)
new (1/4) 195,000 180,000 15,000
P780,000 P780,000 P---0---
1b. Revaluation of Assets Method (AC = P180,000 ÷ 1/4 = P720,000)

Alba, Capital (P60,000 x 40%) 24,000

Medel, Capital (P60,000 x 60%) 36,000
Other Assets (P780,000 - P720,000) 60,000
To record revaluation of assets
Cash 180,000
Almeda, Capital 180,000
2. Alba Medel Almeda

Balances under the bonus method P194,000 P391,000 P195,000
Balances under the asset rev. method P200,000 P400,000 P200,000

Additional depreciation ( 6,666) ( 6,667) ( 6,667)
Balances after depreciation P193,334 P393,333 P193,333
Net advantage to Medel using the asset revaluation method P 2,333
Exercise 2 - 6
1. Garces, Capital 60,000

Kalaw, Capital 60,000
P120,000 x 1/2 = P60,000
2. Cash 60,000
Other Assets (P400,000 – P320,000) 80,000
Kalaw, Capital 40,000
Garces, Capital (P100,000 x 3/8) 37,500
Hilario, Capital (P100,000 x 3/8) 37,500
Juan, Capital (P100,000 x 2/8) 25,000
Total agreed capital P400,000
Total capital contribution 320,000
Asset revaluation P 80,000
Interest acquired from Garces P 60,000

Cash invested in the partnership 60,000
Total P 120,000
Capital credit of Kalaw 100,000
Bonus to old partners P 20,000
Exercise 2 – 7
Bonus method
Sabado Galman Estacio Total
Capital before admission of Estacio P1,000,000 P800,000 P1,800,000
Contribution of Estacio P500,000 500,000
Bonus to old partners 24,000 16,000 ( 40,000)
Capital after admission of Estacio P1,024,000 P816,000 P460,000 P2,300,000
Asset Revaluation method

Sabado Galman Estacio Total
Capital before admission of Estacio P1,000,000 P800,000 P1,800,000
Contribution of Estacio P500,000 500,000
Adjustment of fixed assets to fair value 120,000 80,000 200,000
Capital after admission of Estacio P1,120,000 P880,000 P500,000 P2,500,000
Exercise 2 – 8
1. Bonus method
Noble Calma Reyes Naval Total
Capital balances before admission
of new partners P64,000 P136,000 P200,000
Contributions of new partners P110,000 P120,000 230,000
Bonus to old partners 10,950 25,550 ( 24,000) ( 12,500)
Capital balances after admission
of new partners P74,950 P161,550 P86,000 P107,500 P430,000
Cash 130,000
Equipment 100,000
Noble, Capital 10,950
Calma, Capital 25,550
Reyes, Capital 86,000
Naval, Capital 107,500
2. Asset Revaluation method

Noble Calma Reyes Naval Total
Capital balances before admission
of new partners P64,000 P136,000 P200,000
Adjustment of assets to FV 9,000 21,000 30,000
Contributions of new partners P110,000 P120,000 230,000
of new partners P73,000 P157,000 P110,000 P120,000 P460,000
Cash 130,000
Equipment 84,000
Inventory 14,000
Land 80,000
Building 48,000
Calma, Capital 21,000
Reyes, Capital 110,000
Naval, Capital 120,000
Exercise 2 - 9
1a. Bonus Method
Songco, Capital 200,000
Bueno, Capital 60,000
Manzano, Capital 40,000
Cash/Payable to Songco 300,000
1b. Asset Revaluation Method
Songco, Capital 200,000

Other Assets (P10,000 ÷ 1/6) 600,000
Bueno, Capital (P50,000 x 3/5) 300,000
Manzano, Capital (P50,000 x 2/5) 200,000
Cash/ Payable to Songco 300,000
2. The bonus method will be preferred by Manzano

Bonus Method Asset Rev

Capital of Manzano after retirement P260,000 P500,000
Additional depreciation 300,000
Capital of Manzano after additional depreciation P260,000 P200,000
Net advantage to Manzano with the use of the bonus P60,000

method
Exercise 2 – 10
1.
Delfin, Capital 400,000
Damian, Capital 200,000
Dencio, Capital 200,000
2.
Cash 320,000
3.
Cash 460,000
P460,000 – P400,000 = P60,000/ 1/3 = P180,000
Exercise 2 – 11
1. Guzman, Capital January 1 P100,000
Drawing (16,000)
Share in net profit 24,000
Interest of Guzman upon retirement P108,000
Other Assets 40,000

Guzman, Capital 108,000
Cash 120,000
Jorge, Capital 12,000
Lopez, Capital 16,000
P120,000 – P108,000 = P12,000/ 30% = P40,000
2.
Jorge, Capital 5,143
Lopez, Capital 6,857
Cash 120,000
Exercise 2 – 12
1. Building 200,000
Villa, Capital 60,000
Belen, Capital 40,000
Marcos, Capital 80,000

Cordero, Capital 20,000

Cash 140,000
2. Villa, Capital 15,000

Marcos, Capital 20,000
Cordero, Capital 5,000
Cash 140,000
Exercise 2 - 13
1. Galang, Capital 12,000

Henio, Capital 8,000
Israel, Capital 140,000
Cash 160,000
2. Israel, Capital 140,000

Galang, Capital 140,000

Cash 130,000
4. Other Assets 48,000

Israel, Capital 140,000
Cash 148,000
5. Israel, Capital 140 000

Cash 120,000
PROBLEMS
Problem 2 - 1
1. Locsin, Capital (P240,000 x 1/4) 60,000

Montes, Capital (P120,000 x 1/4) 30,000
Nava, Capital 90,000
2. Locsin, Capital (P240,000 x 1/3) 80,000
3. Other Assets 180,000

Locsin, Capital (P180,000 x 3/4) 135,000
P540,000 – P360,000 = P180,000
Locsin, Capital [(P240,000 + P135,000) 1/3] 125,000

Montes, Capital [(P120,000 + P45,000) 1/3] 55,000
4. Cash 180,000
AC CC Bonus
old (1/2) 270,000 360,000 (90,000)
new (1/2) 270,000 180,000 90,000
540,000 540,000 -----
5. Cash 180,000
AC CC Asset Rev
old (3/4) 540,000 360,000 180,000
new (1/4) 180,000 180,000 -----
720,000* 540,000 180,000
*180,000 ÷ 1/4 = 720,000
6. Cash 240,000
7. Cash 240,000
Locsin, Capital 54,000
Montes, Capital 18,000
8. Cash 150,000
Nava, Capital (P510,000 x 1/4) 127,500
9. Cash 165,000
Other Assetsl (P660,000 – P525,000) 135,000
Nava, Capital (P660,000 x 1/4) 165,000
10 Cash 144,000

Nava, Capital (P504,000 x 1/3) 168,000
Problem 2 - 2
1.
a. Ponce, Capital (P300,000 x ½) 150,000
Anton, Capital 150,000
b. Ponce, Capital (P300,000 x ¼) 75,000

Salva, Capital (P200,000 x ¼) 50,000
Victa, Capital (P100,000 x ¼) 25,000
c. Cash 220,000
Ponce, Capital 7,500
Salva, Capital 4,500
Victa, Capital 3,000
AC CC Bonus
Ponce P307,500 P300,000 P 7,500
Salva 204,500 200,000 4,500
Victa 103,000 100,000 3,000
Anton 205,000 220,000 ( 15,000)
P820,000 P820,000 ------
2.
a. Other Assets 360,000
P960,000 – P600,000 = P360,000

b. Other Assets 120,000

P180,000/ 25% = P720,000 – P600,000 = P120,000

c. Other Assets 60,000

P220,000/ 25% = P880,000 – P820,000 = P60,000
Cash 220,000
Problem 2-3
1.a Cash 90,000
Cabral, Capital 22,500
Corpus, Capital 18,000
Carlos, Capital 4,500
Other Assets 45,000
Camus, Capital 90,000
AC CC Asset Rev
old (3/4) 630,000 675,000 (45,000)
new (1/4) 90,000 90,000 -----
720,000* 765,000 (45,000)
b. Cash 90,000
Carlos, Capital 562
AC CC Bonus
old (1/2) 669,375 675,000 (5,625)
new (1/2) 95,625 90,000 5,625
765,000 765,000 -----
2.a Cabral, Capital 40,500

b. Other Assets 45,000
P90,000/ 1/8 = P720,000 – P675,000 = P45,000
Problem 2 - 4
1. a. Inventories 5,625
Accumulated Depreciation – Equipment 7,500
Allowance for Doubtful Accounts 3,450
Accrued Liabilities 2,925
Roces, Capital (P6,750 x 60/100) 4,050
Lapuz, Capital (P6,750 x 40/100) 2,700
b. Cash 46,875
Doria, Capital 46,875
P187,500/80% = P234,375 x 20% = P46,875
c. Lapuz, Capital 13,388
Roces, Capital 13,388

Roces = (P234,375 x 50%) – P103,800 = P13,388
Lapuz = (P234,375 x 30%) - P83,400 = (P13,388)
2.
Roces, Lapuz and Doria
Statement of Financial Position
April 1, 2008
ASSETS LIABILITIES and PARTNERS’ CAPITAL

Cash P 82,875 Payables P66,750
Receivables P69,000 Accrued Liabilities 2,925
Less Allow. for DA 3,450 65,550 Roces, Capital P117,188
Inventories 129,375 Lapuz, Capital 70,312
Equipment P52,500 Doria, Capital 46,875 234,375
Less Acc. Depr. 26,250 26,250 ________
TOTAL LIABILITIES and
TOTAL ASSETS P304,050 PARTNERS’ CAPITAL P304,050
Problem 2 -5
Roldan Angeles Lazaro Moreno Total
Bal.before admission of Moreno P150,000 P180,000 P300,000 P630,000
Transfer of 1/6 int. to Moreno (30,000) P 30,000
Investment of Moreno 150,000 150,000
Asset revaluation 6,000 6,000 8,000 20,000
Bonus to old partners 6,000 6,000 8,000 (20,000)
of Moreno P162,000 P162,000 P316,000 P160,000 P800,000
2. Roldan 30% x 75% = 22.5%
Angeles 30% x 75% = 22.5%
Lazaro 40% x 75% = 30%
Moreno 25%
Problem 2 – 6
1. Lazo, Capital 19,000

Madrid, Capital 19.000
Buildings 8,000
Allowance for Doubtful Accounts 20,000
Allowance for Valuation of Investments 10,000
Lazo, Capital 60,000

Madrid, Capital 45,333
Nuguid, Capital 105,333
(P200,000 – P19,000 + P19,000 – P20,000) 1/3 = P60,000
(P150,000 – P19,000 + P19,000 – P14,000) 1/3 = P45,333
2. Lazo Madrid Total

Capital balances before admission of Nuguid P199,000 P155,000 P354,000
Revaluation of assets ( 19,000) ( 19,000) ( 39,000)
Capital balances after revaluation P180,000 P136,000 P316,000
Fraction of interest transferred to Nuguid x 1/3 x 1/3 x 1/3
Interest transferred to Nuguid P 60,000 P 45,333 P105,333
Gain on transfer 31,138 23,529 54,667

Cash distribution to partners P 91,138 P 68,862 P160,000
3. Lazo Madrid Nuguid

Capital balances before admission of Nuguid P199,000 P155,000
Revaluation of assets ( 19,000) ( 19,000)
Interest transferred to Nuguid ( 60,000) ( 45,333) 105,333
Balances P120,000 P 90,667 P105,333
Share in net profit 18,000 18,000 18,000
Drawings ( 15,000) ( 12,000) ( 28,000)
Capital balances, December 31, 2008 P123,000 P 96,667 P 95,333
4. Cash 66,000
Accounts Receivable 40,000
Investments 20,000
Accounts Payable 41,000
Osorio, Capital 85,000
Lazo, Capital 5,000

Madrid, Capital 5,000
Nuguid, Capital 5,000
Osorio, Capital 15,000
P315,000 + P85,000 = P400,000 x 1/4 P100,000 – P85,000 =
P15,000
Problem 2 - 7
1. Montero, Capital 100,000

Concio, Capital (P8,000 x 3/5) 4,800
Domino, Capital (P8,000 x 2/5) 3,200
Cash 108,000

Cash 90,000

Cash 90,000
Other Assets (P10,000 ÷ 1/6) 60,000
4. Montero, Capital (P6,000 x 1/6) 1,000

Equipment [(P60,000 x 40%) – P18,000] 6,000
Montero, Capital (P100,000 – P1,000) 99,000

Equipment 18,000
Cash 81,000
Problem 2-8
1. Damaso Dangwa Datu

Capital, January 1, 2008 P120,000 P 70,000 P 80,000
Share in net loss ( 9,600) ( 6,400) ( 16,000)
Drawings ( 24,000) ( 24,000) ( 24,000)
Capital balances, December 31, 2008 P 86,400 P 39,600 P 40,000
2. Dangwa, Capital 39,600

Dmaso, Capital 14,400
Datu, Capital 24,000
Cash 30,000
Inventory 48,000
P39,600 – P30,000 = P9,600 / 20% = P48,000
3. a Other Assets 42,000

Dangwa, Capital 39,600
Cash 48,000
Damaso, Capital 12,600
Datu, Capital 21,000
P48,000 – P39,600 = P8,400/ 20% = P42,000
Dangwa, Capital 39,600
Damaso, Capital 3,150
Datu, Capital 5,250
Cash 48,000
Problem 2 - 9
1. Cash 120,000
Luna, Capital 2,000
Matias, Capital 2,000
AC CC Bonus
Old P294,000 P300,000 P( 6,000)
New 126,000 120,000 6,000
P420,000 P420,000 ----
2. Cash 60,000
Luna, Capital 20,000
Other Assets 60,000
AC CC Asset Rev
Old P240,000 P300,000 (P60,000)
New 60,000 60,000
P300,000 P360,000 (P60,000)
3. Matias, Capital 36,000

P120,000 x 30% = P36,000
4. Luna, Capital 80,000

Cash 96,000

David, Capital 80,000

Problem 2 -10
Canda, Pardo and Andres
Statement of Changes in Partners’ Equity
For the Period January 1, 2006 to January 1, 2009
Canda Pardo Andres Total

Original capital, January 1, 2006 P 62,500 P 25,000 P 12,500 P 100,000
Corrected 2006 net profit 26,375 10,550 5,275 42,200
Drawings (15,000) ( 7,800) ( 5,200) ( 28,000)
Capital, January 1, 2007 P 73,875 P 27,750 P 12,575 P 114,200
Corrected 2007 net profit 10,875 4,350 2,175 17,400
Drawings (15,000) ( 7,800) ( 5,200) ( 28,000)
Corrected 2008 net loss ( 6,750) ( 2,700) ( 1,350) ( 10,800)
Drawings (10,000) ( 5,200) ( 5,200) ( 20,400)
Schedule of computation of corrected net profit

2006 2007 2008
Reported net profit (loss) P 44,000 P 18,500 P (10,500 )
Understatement of accrued expenses 2006 ( 400 ) 400
2007 ( 500 ) 500
2008 ( 650 )
Understatement of accrued revenues 2006 250 ( 250 )
2007 100 ( 100 )
2008 150
Overstatement of inventories 2006 ( 1,500 ) 1,500
2007 ( 2,000 ) 2,000
2008 ( 2,000 )
Understatement of depreciation exp. ( 150 ) ( 350 ) ( 200 )
Corrected net profit (loss) P 42,200 P 17,400 P (10,800 )
2. a. Revenue Receivable 150

Canda, Capital 2,000

Pardo, Capital 800
Andres, Capital 400
Expenses Payable 650
Merchandise Inventory 2,000
Accumulated Depreciation 700
b. Canda, Capital (P3,000 x 625/1000) 1,875

Pardo, Capital (P3,000 x 250/1000) 750
Andres, Capital (P3,000 x 125/1000) 375
Furniture (P4,500 - P1,500) 3,000
c. Andres, Capital 2,625

Furniture 1,500
Cash 1,125
Problem 2 -11
Abelar and Berces

Statement of Changes in Partners’ Equity
For the Period January 1, 2007 to January 15, 2009
Abelar Berces Custodio Total

Capital balances before closing the
books, December 31, 2007 P 50,000 P 30,000 P 80,000
Net profit for 2007 (Sch 1) 6,600 7,400 14,000
Drawing (8,200) (6,800) (15,000)
Capital, December 31, 2007 P 48,400 P 30,600 P 79,000
Admission of Custodio (Sch. 2) (7,800) (5,200) P 33,000 20,000
Net loss for 2008 (5,250) (3,750) (6,000) (15,000)
Drawings (7,500) (5,000) (6,800) (19,300)
Capital, December 31, 2008 P 27,850 P 16,650 P 20,200 P 64,700
Loss on realization on Jan. 15, 2009 (16,520) (11,800)` (18,880) (47,200)
Final cash distribution P 11,330 P 4,850 P 1,320 P 17,500
Schedule 1 - Distribution of 2007 net profit
Abelar_ Berces Total

Salaries P 9,000 P 9,000 P 18,000
Balance - 60%, 40% (2,400) (1,600) ( 4,000)
Total P 6,600 P 7,400 P 14,000
Schedule 2 - Admission of Custodio
Total capital contribution (P79,000 + P20,000) P 99,000

Interest to be credited to Custodio 1/3__
Capital credit of Custodio P 33,000
Capital contribution of Custodio 20,000
Bonus to Custodio from Abelar and Berces P 13,000
MULTIPLE CHOICE
1. B
2. A
3. B P264,000 – [(P278,000 + P418,000 + P192,000) x 1/5] = P86,400
4. A Lima = P100,000 x 80% = P80,000

Mitra = P 50,000 x 80% = P40,000
5. A Asset revaluationP60,000/20% = P300,000 - P150,000 P150,000

Lima = [P100,000 + (P150,000 x 75%)] x 80% P170,000
Mitra = [P 50,000 + (P150,000 x 25%)] x 80% P 70,000
Nova P 60,000
6. D Felix Elias Total

Original investment P 24,000 P 48,000 P 72,000
Net profit 5,430 10,860 16,290
Drawings ( 5,050) ( 8,000) ( 13,050)
Capital bal . before transfer to Desta P 24,380 P 50,860 P 75,240
Required capital based on orig. capital
ratio after transfer to Desta of 1/4 int. 18,810 37,620 56,430
Capital to be transferred to Desta P 5,570 P 13,240 P 18,810
Excess cash to be dist. based on orig.
capital ratio (P30,000 - P18,810) 3,730 7,460 11,190
Distribution of cash to Felix and Elias P 9,300 P 20,700 P 30,000
7. D
8. C
9. C P90,000 – P75,000 = P15,000
10. A Capital of Mison prior to admission of Zamora P105,000
Share in the bonus from Zamora [(P90,000 – P75,000) 1/2) 7,500
Capital of Mison in the new partnership P112,500
11. C AC CC Asset Rev

Voltaire P180,000 P150,000 P30,000
Asuncion 210,000 180,000 30,000
Leonor 195,000 195,000
P585,000 P525,000 P60,000
12. D P195,000 – (P525,000 x 1/3 = P175,000) = P20,000

13. A Old partners’ capital contribution P600,000
Percentage of interest of old partners ÷ 75%
Total agreed capital of the new partnership P800,000
Percentage of interest of Sison x 25%
Capital credit of Sison P200,000
Bonus to Sison 70,000
Cash to be contributed by Sison P130,000
14. C Rivera Sanchez Torres

Capital balances before adm. of Vidal P504,000 P252,000 P 84,000
Asset revaluation
(P180,000/20% ) – P840,000 = P60,000 36,000 18,000 6,000
Adjusted capital balances P540,000 P270,000 P 90,000

Percentage of unsold interest x 80% x 80% x 80%
Capital balances after adm. of Vidal P432,000 P216,000 P 72,000
15. D Total capital of the new partnership (P840,000/75%) P1,120,000

Percentage of interest x 25%
Amount to be invested by Vidal in the partnership P 280,000
16. B Agreed capital P330,000

Capital contribution = P95,000 + P80,000 + P60,000 + P80,000 = 315,000
Asset revaluation P 15,000
17. A P80,000 + P12,000 – P70,000 = P22,000
18. C Capital balance before admission of Manalo P 80,000

Interest sold to Manalo (P80,000 x 15%) (12,000)
Share in the recorded asset revaluation (P15,000 x 3/10) 4,500
Share in the bonus from Manalo
[(P80,000 + P12,000) - P70,000] x 3/10 6,600
Capital balance after admission of Manalo P 79,100
19. B Juan Cosme Luna Magno

Capital balances, April 30, 2008 P 360,000 P 225,000 P 135,000
1/6 Interest transferred to Magno ( 60,000) ( 37,500) ( 22,500) P 120,000
Balances P 300,000 P 187,500 P 112,500 P 120,000
Cash transfers to equalize ( 100,000) 12,500 87,500
investment
Balances P 200,000 P 200,000 P 200,000 P 120,000
Distribution of net profit -equally 3,150 3,150 3,150 3,150
Withdrawals ( 1,500) ( 2,000) ( 1,500) ( 2,000)
Capital, June 30, 2008 P 201,650 P 201,150 P 201,650 P121,150
20. A Agreed capital = (P201,650 + P201,150 + P201,650) ÷ 3/4 = P805,933

Interest of Magno 1/4___
Required capital credit of Magno P201,483
Capital balance of Magno before investing cash 121,150
Cash to be invested by Magno P 80,333
21. A Galang Hizon Isleta

Asset revaluation method:
Capital contributions of partners P600,000 P480,000 P500,000
Asset revaluation 252,000 168,000
Additional depreciation ( 140,000) ( 140,000) ( 140,000)
Capital balances P712,000 P508,000 P360,000
Bonus method:
Capital contributions of partners P600,000 P480,000 P500,000
Bonus to old partners from new partner 63,000 42,000 ( 105,000)
Net advantage of bonus method to Isleta P 35,000
22. A Campos Centeno

Capital balance P641,976 P728,352
Uncollectible accounts ( 20,000) ( 35,000)
Worthless inventories ( 5,500) ( 6,700)
Other assets written off ( 2,000) ( 3,600)

Adjusted capital P614,476 P683,052
23. C Total capital P614,476 +P683,052 P1,297,528

Total liabilities 967,590
P2,265,118
24. D Total capital P1,297,528 / 80% P1,621,910

Interest of Coronel x 20%
Contribution of Coronel P 324,382
25. D Campos Centeno

Capital balances P614,476 P683,052
Required capital P1,297,528/2 648,764 648,764
Cash paid (received) P 34,288 (P34,288)
26. B Campos Centeno Coronel

Cash paid (received) 34,288 (34,288)
Net profit 130,000 130,000 65,000
Drawings (50,000) (65,000) (28,000)
P728,764 P713,764 P361,382
27. C The capital balances would be the same as the balances prior to sale of interest.
28. C
29. D
30. D P4,000 x 2/5 = P1,600
31. D P3,000 / 40% = P7,500
32. A P12,000/3 = P4,000
33. C Yumul Yason Ylagan

Interest before retirement P103,000 P 77,000 P180,000
Adjustment of assets to FMV 12,000 12,000 24,000
P115,000 P 89,000 P204,000
Retirement of Yumul (115,000) ( 2,000) ( 4,000)
Capital balance of Ylagan P200,000
34. A Amount paid to retiring partner P28,000

Capital of retiring partner
Total capital before retirement P110,000
Total capital after retirement 90,000 20,000
Asset revaluation to retiring partner P 8,000
Fraction of interest of retiring partner ÷ 2/10
Total asset revaluation P40,000

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1. Sales, Capital 140,000

2. P280,000 + P320,000 + P200,000 = P800,000

1. Total capital (P3,000,000 / 80%) P3,750,000

Cortes, Capital P200,000 + P50,000 x 1/4 62,500

Conde, Capital P270,000 + 270,000 x 1/3 180,000

1b. Revaluation of Assets Method (AC = P180,000 ÷ 1/4 = P720,000)

Alba, Capital (P60,000 x 40%) 24,000

2. Alba Medel Almeda

Balances under the asset rev. method P200,000 P400,000 P200,000

Net advantage to Medel using the asset revaluation method P 2,333

1. Garces, Capital 60,000

Interest acquired from Garces P 60,000

Asset Revaluation method

Capital after admission of Estacio P1,120,000 P880,000 P500,000 P2,500,000

2. Asset Revaluation method

Songco, Capital 200,000

2. The bonus method will be preferred by Manzano

Bonus Method Asset Rev

Net advantage to Manzano with the use of the bonus P60,000

Other Assets 40,000

Marcos, Capital 80,000

Belen, Capital 140,000

2. Villa, Capital 15,000

1. Galang, Capital 12,000

2. Israel, Capital 140,000

3. Israel, Capital 140,000

4. Other Assets 48,000

5. Israel, Capital 140 000

1. Locsin, Capital (P240,000 x 1/4) 60,000

3. Other Assets 180,000

Locsin, Capital [(P240,000 + P135,000) 1/3] 125,000

Locsin, Capital (P24,000 x 3/4) 18,000

b. Ponce, Capital (P300,000 x ¼) 75,000

Ponce, Capital 240,000

b. Other Assets 120,000

Ponce, Capital 90,000

c. Other Assets 60,000

2.a Cabral, Capital 40,500

Roces, Capital 13,388

ASSETS LIABILITIES and PARTNERS’ CAPITAL

1. Lazo, Capital 19,000

Lazo, Capital 60,000

2. Lazo Madrid Total

Gain on transfer 31,138 23,529 54,667

3. Lazo Madrid Nuguid

Lazo, Capital 5,000

1. Montero, Capital 100,000

2. Montero, Capital 100,000

3. Montero, Capital 100,000

4. Montero, Capital (P6,000 x 1/6) 1,000

Montero, Capital (P100,000 – P1,000) 99,000

1. Damaso Dangwa Datu

2. Dangwa, Capital 39,600

3. a Other Assets 42,000

3. Matias, Capital 36,000

P120,000 x 30% = P36,000

4. Luna, Capital 80,000

5. Luna, Capital 80,000

6. Luna, Capital 80,000

Canda Pardo Andres Total

Schedule of computation of corrected net profit

2. a. Revenue Receivable 150

Canda, Capital 2,000