Compute the adjusted capital of X and Y using the bonus method. Prepare the journal entries to
Fantastic news! We've Found the answer you've been seeking!
Question:
Prepare the journal entries to record the contributions.
Compute the amount of bonus.
Transcribed Image Text:
X and Y agreed to form a partnership. They also agreed to contribute their personal assets to the partnership. X has a note payable, and they also agreed that this payable would be assumed by the partnership. Y Cash Accounts receivable Inventory Land Building Note payable Total X P200,000 60,000 90,000 (50,000) 300,000 P1,200,000 3,800,000 5,000,000 Additional information: • All accounts that are included in accounts receivable can be collected. The land has an unpaid mortgage of P20,000. The partners have agreed that neither the partnership nor any of them will assume that mortgage. The building is overstated by P1,200,000. There is no unpaid mortgage on the building. The profit or loss sharing of the partners is 40:60, respectively. Assume that the capital ratio is the same as the profit or loss ratio, X and Y agreed to form a partnership. They also agreed to contribute their personal assets to the partnership. X has a note payable, and they also agreed that this payable would be assumed by the partnership. Y Cash Accounts receivable Inventory Land Building Note payable Total X P200,000 60,000 90,000 (50,000) 300,000 P1,200,000 3,800,000 5,000,000 Additional information: • All accounts that are included in accounts receivable can be collected. The land has an unpaid mortgage of P20,000. The partners have agreed that neither the partnership nor any of them will assume that mortgage. The building is overstated by P1,200,000. There is no unpaid mortgage on the building. The profit or loss sharing of the partners is 40:60, respectively. Assume that the capital ratio is the same as the profit or loss ratio,
Expert Answer:
Answer rating: 100% (QA)
To compute the adjusted capital of X and Y using the bonus method we need to make adjustments based ... View the full answer
Related Book For
Smith and Roberson Business Law
ISBN: 978-0538473637
15th Edition
Authors: Richard A. Mann, Barry S. Roberts
Posted Date:
Students also viewed these accounting questions
-
The balance sheet of Adams Pharmacy after the revenue, expense, and partners' drawing accounts have been closed on December 31, 2016, follows: On that date, Larry Adams, Hazel Adams, and Isiah Adams...
-
On December 31, Year 6, Ultra Software Limited purchased 70,000 common shares (70%) of a major competitor, Personal Program Corporation (PPC), at $30 per share. Several shareholders who were...
-
The following is an abbreviated balance sheet for Grizzly Grocers: Grizzly Grocers Ltd. Statement of Financial Position As at December 31, 2010 The company had net earnings of $20,000 on sales of...
-
Suppose the comparative balance sheets of Sage Hill Inc.. are presented here. SAGE HILL INC. Condensed Balance Sheet May 31 ($ in millions) 2019 2018 Assets Current Assets $9,680 $8,760 Property,...
-
A parallel-plate vacuum capacitor with plate area A and separation x has charges + Q and - Q on its plates. The capacitor is disconnected from the source of charge, so the charge on each plate...
-
Look at the entire glycolysis pathway and make a list of the kinds of organic reactions that take place-nucleophilic acyl substitutions, aldol reactions, E1cB reactions, and so forth.
-
Classify each of the following as: Trading security (T) Available-for-sale security (A) Held-to-maturity security (H) None of the above (N) 1. A bond that management plans on owning until it is...
-
In Lizzie Shoes experience, gift cards that have not been redeemed within 12 months are not likely to be redeemed. Lizzie Shoes sold gift cards for $18,000 during August of 2011. $4,000 of cards were...
-
Comparative financial statements for Weaver Company follow: Weaver Company Comparative Balance Sheet at December 31 Assets Cash Accounts receivable Inventory Prepaid expenses Total current assets...
-
This is a mathimatical function: f(y) = y + 3y - 12 Define a function called function Ofy which accepts a integer number as an argument and returns the result of the mathimatical function. Call the...
-
Discuss why combination approaches are considered an important consultative-selling practice. Provide one example of a combination approach.
-
In a decision to make a previously purchased part, think of two incremental costs that might not be avoidable if the decision is reversed a year later. Why would this happen?
-
How is the cash return on owner's equity of a business computed, and what does it measure?
-
List and describe the three most common types of business-to-business buying situations.
-
How is the operating cash flow margin of a business computed, and what does it describe?
-
he current cost accounting system charges overhead to products based on direct labor hours. What unit product costs will be reported for the three products if the current cost system continues to be...
-
Write a declaration for each of the following: a. A line that extends from point (60, 100) to point (30, 90) b. A rectangle that is 20 pixels wide, 100 pixels high, and has its upper-left corner at...
-
Anthony lends money to Frank. Frank dies without having paid the loan. Franks widow, Carol, promises Anthony to repay the loan. Upon Carols refusal to pay the loan, Anthony brings suit against Carol...
-
This is an action by purchasers of 5 percent convertible subordinated fifteen year debentures of BarChris Construction Corporation (BarChris). * * * The action is brought under Section 11 of the...
-
Plaintiff, Brenner, entered into a contract with the defendant, Little Red School House, Ltd., which stated that in return for a nonrefundable tuition of $1,080 Brenners son could attend defendants...
-
The ratio of successive amplitudes of a viscously damped single-degree-of-freedom system is found to be 18:1. Determine the ratio of successive amplitudes if the amount of damping is (a) doubled, and...
-
Find the variation of the displacement with time, \(x(t)\), of a damped single-degree-of-freedom system with \(\zeta=0.1\) for the following initial conditions: a. \(x(t=0)=x_{0}=0.2 \mathrm{~m},...
-
Find the variation of the displacement with time, \(x(t)\), of a damped single-degree-of-freedom system with \(\zeta=1.0\) for the following initial conditions: a. \(x(t=0)=x_{0}=0.2 \mathrm{~m},...
Study smarter with the SolutionInn App