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A B
Cash 200,000
Account Receivable 150,000
Inventory 100,00
Land 500,000
Building 620,000
Total 450,000 1,120,000

Note Payable 220,000

A, Capital 230,000
B, Capital 1,120,000
Total 450,000 1,120,000

1. How much are the adjustment capital balances of A and B, respectively.

Solutions:
A B Partnership
Cash 200,000 200,000
Account Receivable 120,000 120,000
Inventory (P110,000 – P20,000) 90,000 90,000
Land 500,000 500,000
Building (620,000 + 30,000) 650,000 650,000
Total 410,000 1,150,000 1,560,000

Note Payable, net (210,000) (210,000)

Mortgage payable – bldg. (550,000) (550,000)
Adjustment Capital balances 200,000 600,000 800,000