MITCH T.

MINGLANA
BSA 301

PROBLEM 3:

Required: Compute for

a.) The capital account of the partners after the adjustments
b.) How much total assets does the partnership have after formation?

ANSWER AND SOLUTION:

Requirements (a) and (b):

C M TOTAL

Cash 11,000 22,354 33,354

Accounts receivable 214,536 532,890 747,426
Inventory 120,035 260,102 380,137
Land 603,000 603,000
Building 428,267 428,267
Equipment 50,345 34,789 85,134
Other assets
Total assets 998,916 1,278,402 2,277,318
Accounts payable (178,940) (243,650) (422,590)
Notes payable (200,000) (345,000) (545,000)
Net assets 619,976 689,752 1,309,728

PROBLEM 4: What amount of income would be necessary so that Irene would consider
the choices to be equal?

ANSWER AND SOLUTION:

15,000=.10 (Profit-Bonus- Salaries)

15,000=.10(P- 15,000 - 125,000)
15,000=.10P- 1,500-12,500= .10P
29,000=.10P
29,000/.10= .10P/.10
290,000= PROFIT

PROBLEM 5:

ANSWER AND SOLUTION: