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Partnership and Corporation Accounting Chapter 3 SolMan
Partnership and Corporation Accounting Chapter 3 SolMan
Ex. 1
a) Cash 250,000
Diaz, Capital 250,000
Equipment 150,000
Cash 100,000
Bravo, Capital 250,000
Entries:
1) Gain 30,000
Sales 2,498,140 3) Income Summary 883,050
Sales Discount 11,620 Rent 520,350
IncomeSummary 2,516,520 Insurance 128,500
Other Oper Exp. 201,700
Depreciation 31,000
Bad Debts 1,500
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2) Inventory, end 125,800
Income Summary 985,130 4) Income Summary 194,502
Inventory, beg. 537,500 Taxes Payable 194,502
Purchases 545,890
Freight In 27,540
d.
HYPER SUPER MART
STATEMENT OF CHANGES IN PARTNERS’ EQUITY
For the year ended, Dec. 31, 2018
YOUNG GO TOTAL
Balances, Jan. 1 450,000 550,000 1,000,000
Add Share in Net Income 204,227 239,611 453,838
Total 654,227 789,611 1,453,838
Less: Regular Drawings (40,040 ) (32,500 ) (72,540)
Balances, Dec. 31 P614,187 P757,111 P1,371,298
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Barbie 450,000 – 70,000 net loss = P380,000 - 80,000 drawings + 253,333 profit = P 553,333
P1,140,000 P1,670,000
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Ex. 5
a. Revenue & Expense Summary 170,000
Max, Drawing 127,000
Kenneth, Drawing 43,000
c.
Revenue & Expense Summary 84,000
Mac, Drawing 84,000
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110,250 x .7= P77,175 after tax.
Max Kenneth Total
6% Interest 15,000.00 9,000.00 24,000.00
6,000 salary x 6 months 36,000.00 36,000.00
Remainder (8,587.5) (8,587.5) ( 17,175.00)
59,587.5 (17,587.5) 77,175.00
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Ador, Drawing (1,400/3,025) 64,793
The ending capital ratio will give Ador a higher share because of his additional investment of P80,000
resulting in a higher ending balance compared to that of Reina.
Ex. 7
Option 1 Joffre Ric Total
20% bonus 90,000 90,000
Remainder 2:1 240,000 120,000 360,000
240,000 210,000 450,000
Considering contribution of Joffre is twice that of Ric, although Ric is a managing partner, profit should
be more or less the same, Option 1 would be better.
Ex 8. 240,000/.4= 600,000 x .6= 360,000 required capital for Bruce - P194,000 non cash investment=
Addtl cash investment required for Bruce P166,000.
a. Cash 166,000
Accounts Receivable 30,000
Inventory 138,000
Equipment 240,000
Accounts Payable 200,000
Notes Payable 14,000
Bruce, Capital 360,000
Inventory 146,500
Cash 93.500
Rachel, Capital 240,000
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Cash P259,500
Accounts Receivable 30,000
Inventory 284,500
Equipment 240,000
Total Assets P814,000
Ex 9.
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d.
Income Summary 175,000
Bruce, Drawings 94,700
Rachel, Drawings 80,300
Ex. 10
Net income (6,750-4,050-1,012.5) = 1,687.5 x 30% = P506,250
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Income & Expense Summary 120,000
Aubrey, Drawing 59,417
Billy, Drawing 60,583
Ex 13.
Glas Poe Co Total
1) Salaries 120,000 120,000
Remainder 240000 240,000 ______ 480,000
240000 240,000 120,000 600,000
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2) Income Summary 600,000
Glas Drawings 240,000
Poe Drawings 240,000
Co Drawings 120,000
Ex 14.
b) Glas Poe Co Total
Salaries 240,000 240,000
Remainder 326,600 326,600 56,800 710,000
326,600 326,600 296,800 950,000
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b)
Dela Cruz Quizon Ocampo Total
Salary 60,000 60,000
Interest 45,000 27,000 - 72,000
Remainder (103,500) (103,500) - (207,000)
,(58,500) (76,500) 60,000 ( 75,000)
a) A B C Total
Salary 60,000 60,000
Remainder 40,000 25,000 25,000 90,000
Total 100,000 25.000 25,000 150,000
17.
a. Revenue & Expense Summary 480,000
Beth, Drawing 228,000
Luz, Drawing 126,000
Ana, Drawing 126,000
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Beth Luz Ana Total
Salaries 120,000 120,000 120,000 360,000
20% Bonus 20,000 20,000
Rem 2:1:1 50,000 25,000 25,000 100,000
190,000 145,000 145,000 480,000
18.
Luz Total
a) Salaries 60,000 180,000
a) Bonus 20% of 425,000 85,000
b) 2:1:1 40,000 160,000
100,000 425,000
B = 20% of (180,000 +160,000 + B)
= 68,000 + .2B
= 68,000 / .8 = 85,000
NI = 85,000 / .2 = 425,000
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Profit Share 55,000 56,000 111,000
b)
Current Account: Zed Wye Total
Beg Balance 32,000 29,000 61,000
Profit share 55,000 56,000 111,000
Drawings (42,000) (37,000) ( 79,000)
Current, End Bal 45,000 48,000 93,000
c)
Zed Wye Total
Capital accounts 150,000 140,000 290,000
Current accounts 45,000 48,000 93,000
Ending equity 195,000 188,000 383,000
20.
260000 – 180,000 = 8,000 profit
Quinlan Alves Total
15% interest 7,500 4,500 12,000
Salary 70,000 80,000 150,000
Balance (41,000) (41,000) (82,000)
Profit Share 36,500 43,500 80,000
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12% interest 7,200.00 4,800.00 12,000.00
Rem Equally 121,631.50 53,157.75 243,263.00
2. Yes professional ethics will be violated since there will be a conflict of interest, independence in mental attitude is
also violated.
3. The answer is the same because of the time involved and his attention which will be divided in case
he engages in another business. He needs the permission of the capitalist partners.
ACCOUNTING ISSUES
1. C gets P70,000 and the balance is divided by A and B based on capital contribution.
2. Unless stipulated, C does not share in the loss. The P350,000 is divided by A and B
Based on their P and L ratio. Art 1797.
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MJ THAI SPA
WORKSHEET
FOR THE YEAR ENDED DEC. 31, 2018
TRIAL BALANCE ADJUSTING ENTRIES ADJ. TRIAL BAL. INCOME STATEMENT JAY, PERSONAL MEL, PERSONAL FINANCIAL POSITION
Debit Credit Debit Credit Debit Credit Debit Credit Debit Credit Debit Credit Debit Credit
Cash P58,850 58,850 58,850.0
Accounts Receivable 32,400 32,400 32,400.0
Allow. for Bad Debts 2,500 1) 740 3,240 3,240.0
Notes Receivable 19,000 19,000 19,000.0
Unexpired Insurance 2,575 4) 1287.5 1,287.5 1,287.5
Furniture & Fixtures 238,000 238,000 238,000.0
Accum. Depn. – Furn. 5,950 2)11,900 17,850 17,850.0
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5
Net inc. before tax 578,947.5 _______
2,482,305
2,482,305
30% tax 578,947.5
1,736,845 173,684.5
Net Income after tax 405,263 183,831.50 216,431.50
Drawing Balances _______ _______ 177,731.5 _____ 208,931.5 ________ _______ 386,663.0
578,947.5 578,947.5 120357,75 120357.75 147957.75 147957.75 789,937.5 789,937.5
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