1.Determine the capital balances of Guerrero, Alajar, and Franco after Franco’s admission to the partnership.

Guerrero Alajar Franco Total

Capital balances 140,000 56,000 196,000
Sales of interest -49,000 -19,600 68,600 0
Capital, end 91,000 36,400 68,600 196,000

REQ. 2: 0, there is no bonus because this is just a purchase of interest, thus, a transaction between partners and not with th
 partnership.

ween partners and not with the partnership itself.

1.Ortiz invested P 30,000 for a one-fourth interest in net assets; the total partnership capital after Ortiz’s admission will be P 8

Gonzaga Denajeba Ortiz TOTAL

Contributed Capital 30,000 20,000 30,000 80,000
Bonus to old partners 7,500 2,500 -10,000 0
Agreed Capital 37,500 22,500 20,000 80,000

Computation of agreed capital:

Ortiz (80k x 1/4 of interest) 20,000
Bonus to old partners (30,000 - 20,000) 10,000
Bonus to Gonzaga (10,000 x 3/4) 7,500
Bonus to Denajeba (10,000 x 1/4) 2,500

JOURNAL ENTRIES:
Cash 30,000
Ortiz, Capital 30,000

Ortiz, Capital 10,000

Gonzaga, Capital 7,500
Denajeba, Capital 2,500

2.Ortiz invested P 30,000, of which P 10,000 is a bonus to Gonzaga and Denajeba. In conjunction with the admission of Ortiz, t

JOURNAL ENTRIES:
Cash 30,000
Ortiz, Capital 30,000

Ortiz, Capital 10,000

Gonzaga, Capital 7,500
Denajeba, Capital 2,500

Inventory 16,000
Gonzaga, Capital 12,000
Denajeba, Capital 4,000
r Ortiz’s admission will be P 80,000

with the admission of Ortiz, the carrying amount of the inventories is increased by P 16,000. Ortiz’s capital account is credited for P 20,00
account is credited for P 20,000
PROBLEM 3: How much cash should be distributed to each partner?

Sale of NCA 900,000

Liquidation exp -20,000
NC proceeds 880,000
C/A of NCA -2,100,000
Total loss -1,220,000

Limin Parducho Calingasan Total

Capital balances 400,000 720,000 700,000 1,820,000
Payable to Limin 80,000 80,000
Allocation of loss:
(1.22M x 50%; 30%; 20%) -610,000 -366,000 -244,000 -1,220,000
TOTAL -130,000 354,000 456,000 680,000
Allocation of capital def
of Limin 130,000 -78,000 -52,000 0
Amount perceived by
partners 0 276,000 404,000
PROBLEM 4: Prepare the necessary journal entries to account for the transactions during January 202B

NC proceeds 100,000
C/A of NCA -160,000
Total loss -60,000

Jumao-as Escasinas Quino Total

Capital balances 150,000 80,000 270,000 500,000
Allocation of loss -24,000 -18,000 -18,000 -60,000
Amounts received by
partners 126,000 62,000 252,000 440,000

JOURNAL ENTRIES:
Jumao-as, Capital 126,000
Escasinas, Capital 62,000
Quino, Capital 252,000
Cash 440,000