P160,765 c. P157,985 b. P152,985 d. P156,875 Ables and Galang executed a partnership agreement that lists the following assets contributed at the partnership's formation: Contributed by: Ables Galang Cash 20,000 30,000 Inventory 15,000 Building 40,000 Furniture and Equipment 15,000 The building is subject to a mortgage of P10,000, which the partnership has assumed. The partnership agreement also specified that profits and losses are to be distributed equally. What amounts should be recorded as capital for Ables and Galang at the formation of the partnership? Ables Galang a. 35,000 85,000 b. P35,000 75,000 c. P55,000 p30,000 d. P60,000 60,000 Orcajada invested in a partnership a parcel of land which cost his father P200,000. ‘The land had a market value of 300,000 when Orcajada inherited it three years ago. Currently, the land is independently appraised at P500,000 even though Orcajada insisted that he "wouldn't take P900,000 for it." The land should be recorded in the accounts of the partnership at a. P300,000. b. 500,000. Basic Considerations and Formation | 47Reena aa eases nana emuain a maie aT an eeaaeaa as aera c, 900,000. d. P200,000. On Apr. 30, 2018, Lacson, Yacapin, and Bernal formed a partnership by combining their separate business proprietorships. Lacson contributed cash of 50,000 Yacapin contributed property. with a P36,000 carrying amount, a P40,000 original cost, and P80,000 fair value The partnership accepted responsibility for the 35,000 mortgage attached to the property. Bernal contributed equipment with a P30,000 carrying amount, a P75,000 original cost, and P55,000 fair value. The partnership agreement specifies that profits and losses are to be shared equally but is silent regarding capital contributions. Which partner has the largest Apr. 30, 2018, capital balance? a. Lacson c. Bernal b. — Yacapin d. — Allcapital account balances are equal On Aug. 1, Isada and Ureta-Reyes pooled their assets to form a partnership, with the firm to take over their business assets and assume the liabilities. Partnership capitals are to be based on net assets transferred after the following adjustments Profits and losses are allocated equally The inventory of Ureta-Reyes is to be increased by P4,000; an allowance for doubtful accounts of P1,000 and P1,500 are to be set up in the books of Isada and Ureta-Reyes, respectively; and accounts payable of P4,000 is to be recognized in Isada’s books. The individual trial balances on August, before adjustments, follow: Isada Assets P75,000 Liabilities 5,000 _Ureta-Reyes P113,000 34,500 What is the capital of Isada and Ureta-Reyes after the above adjustments? a. sada, P68,750; U. Reyes, P77,250 b. c \sada, P65,000; U. Reyes, P81,000 Isada, P65,000; U. Reyes, P76,000 d. _ Isada, P75,000; U. Reyes, P81,000 Calma and Abello formed a partnership on April 1 and contributed the following assets: Calma Cash P 150,000 land Abello P 50,000 310,000 prestane! was subject to a mortgage of P30,000, which was assumed by the pare i ip jusder the rartnerihde agreement, Calma and Abello will share profit @ ratio of one-third and two- r al Sree oe erates wo-thirds, respectively. Abello’s capi 48 | Partnership and Corporation Accountingsina and hich with ship nts, for and 0 0 ving the “ofit ita! ~ 10. 11. 12. a. P330,000. b. P360,000. cc. P300,000. d. 340,000. Pedernal, Pating, and Liggayu are forming a new partnership. Pedernal is to invest cash of P100,000 and stapling equipment originally costing P120,000 but has @ second-hand market value of P50,000. Pating is to invest cash of P160,000. Liggayu, whose family is engaged in selling stapling equipment, is to contribute cash of P50,000 and a brand new stapling equipment to be used by the partnership with ‘a regular price of 120,000 but which cost their family’s business P100,000. Partners agreed to share profits equally. The capital balances upon formation are Pedernal, P220,000; Pating, P'160,000; and Liggayu, P150,000. Pedernal, P150,000; Pating, P160,000; and Liggayu, P170,000. Pedernal, P160,000; Pating, P160,000; and Liggayu, P160,000. Pedernal, P176,666; Pating, P176,666; and Liggayu, P176,668. ange Estrada and Molina formed a partnership on Mar. 1, 2018 and contributed the following assets: Estrada Molina Cash 80,000 50,000 Equipment The equipment was subject to a chattel mortgage of P10,000 that was assumed by the partnership. The partners agreed to share profits and losses equally, Molina’s capital account at Mar. 1, 2018 should be 50,000. cc. P40,000. P60,000. ey b. 45,000. d. On Mar. 1, 2018, Kalaw and Borromeo formed a partnership with each contributing the following assets: Kalaw ___Borromeo _ Cash 30,000 P 70,000 Machinery and Equipment 25,000 75,000, Building. < 225,000 10,000 2 Furniture and Fixtures to mortgage loan of P80,000, which is to be assumed by the int provides that Kalaw and Borromeo share profits and losses 8 the balance in Borromeo’s capital The building is subject partnership. Agreeme! 30% and 70%, respectively. On Mar. 1, 201 account should be Basic Considerations and Formation | 4913. 14. 15. 16. c. _ P305,000. 8. 0370/0 d. _P290,000. b. P314,000. ‘The same information in the previous number except that the mortgage loan is not resumed by the partnership. On Mar. 1, 2018 the balance in Borromeo’s capital account should be 305,000. 370,000. © , b 314,000, d. P290,000. On July 1, Faminial and Fetalvero formed a partnership, agreeing to share profits sand loxses in the ratio of 4:6 respectively. Faminial contributed a parcel of land that ost P25,000. Fetalvero contributed P50,000 cash. The land was sold for P50,000 on luly 4, three hours after formation of the partnership. How much should be recorded in Faminial’s capital account on formation of the partnership? a. P50,000. c. P25,000. b, P20,000. d. P10,000. On Apr. 30, 2018, Foja, Lupian, and Retada formed a partnership by combining their separate business proprietorships. Foja contributed cash of P50,000. Lupian contributed property with a P36,000 carrying amount, a P40,000 original cost, and 80,000 fair value. The partnership assumed the P35,000 mortgage attached to the property. Retada contributed equipment with a P30,000 carrying amount, a 75,000 original cost, and P55,000 fair value. The partnership agreement specified that profits and losses are to be shared equally. Which partner has the largest Apr. 30, 2018, capital account balance? a. Foja. b. Retada. cc. Lupian. d. Allcapital account balances are equal. Lacson and Solis started a partnership. Lacson contributed a building that she Purchased 10 years ago for P100,000. The accumulated depreciation on the balclng on ip date of formation of the partnership is P25,000 and the fair value is ,000. For what amount will Lacson’s capital acco i af the paren? pi unt be credited on the books a. 100,000 << F b. P75,000 110,000 d. P25,000 50 | Partnership and Corporation Accounting