On August 1, 2010, Marie and Paz formed a partnership. Marie contributed inventory of P500,000 with...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
On August 1, 2010, Marie and Paz formed a partnership. Marie contributed inventory of P500,000 with a fair value of P300,000 while Paz contributed cash of P250,000 and a land valued that cost her P900,000 with a carrying amount of P1,000,000 and a fair value of P1,250,000. The partnership did not assume the mortgage attached to the property worth P250,000. The partners agree to allocate profits and losses as follows: 1. Each partner shall receive 5% interest on the amount of his beginning capital. 2. Marie will receive a salary of P8,000 per month. 4. 3. The remainder will be divided equally on the first year and 60:40 on subsequent years. Marie and Paz are allowed to withdraw P5,000 per month. Any withdrawal is treated as a direct reduction of capital. In 2010, the partnership has a credit balance of income summary of P100,000. On July 1, 2011, Ivonne was admitted in the partnership by investing P800,000 for a 25% interest. Asset revaluation is to be recognized. After admission of Ivonne, the partners agreed to divide profits as follows: 1. Each partner shall receive 5% interest on the amount of his beginning capital. 2. All partners will receive a salary of P2,000 per month. 3. The balance to be divided 45% to Marie, 30% to Paz and 25% to Ivonne. 4. Each partner is allowed to withdraw P2,000 per month. Any withdrawal is treated as a direct reduction of capital. In 2011, the partnership earned a profit of P300,000 evenly throughout the year. How much is the capital balance of Marie at the end of December 31, 2011. On August 1, 2010, Marie and Paz formed a partnership. Marie contributed inventory of P500,000 with a fair value of P300,000 while Paz contributed cash of P250,000 and a land valued that cost her P900,000 with a carrying amount of P1,000,000 and a fair value of P1,250,000. The partnership did not assume the mortgage attached to the property worth P250,000. The partners agree to allocate profits and losses as follows: 1. Each partner shall receive 5% interest on the amount of his beginning capital. 2. Marie will receive a salary of P8,000 per month. 4. 3. The remainder will be divided equally on the first year and 60:40 on subsequent years. Marie and Paz are allowed to withdraw P5,000 per month. Any withdrawal is treated as a direct reduction of capital. In 2010, the partnership has a credit balance of income summary of P100,000. On July 1, 2011, Ivonne was admitted in the partnership by investing P800,000 for a 25% interest. Asset revaluation is to be recognized. After admission of Ivonne, the partners agreed to divide profits as follows: 1. Each partner shall receive 5% interest on the amount of his beginning capital. 2. All partners will receive a salary of P2,000 per month. 3. The balance to be divided 45% to Marie, 30% to Paz and 25% to Ivonne. 4. Each partner is allowed to withdraw P2,000 per month. Any withdrawal is treated as a direct reduction of capital. In 2011, the partnership earned a profit of P300,000 evenly throughout the year. How much is the capital balance of Marie at the end of December 31, 2011.
Expert Answer:
Answer rating: 100% (QA)
To solve the problem we need to compute the following 1 Capital balances of each partner as of August 1 2010 2 Allocation of profit and loss for the f... View the full answer
Related Book For
Accounting
ISBN: 978-0324662962
23rd Edition
Authors: Jonathan E. Duchac, James M. Reeve, Carl S. Warren
Posted Date:
Students also viewed these accounting questions
-
The Crazy Eddie fraud may appear smaller and gentler than the massive billion-dollar frauds exposed in recent times, such as Bernie Madoffs Ponzi scheme, frauds in the subprime mortgage market, the...
-
The following additional information is available for the Dr. Ivan and Irene Incisor family from Chapters 1-5. Ivan's grandfather died and left a portfolio of municipal bonds. In 2012, they pay Ivan...
-
Read the case study "Southwest Airlines," found in Part 2 of your textbook. Review the "Guide to Case Analysis" found on pp. CA1 - CA11 of your textbook. (This guide follows the last case in the...
-
A stock is trading at $70. You believe there is a 70% chance the price of the stock will increase by 10% over the next 3 months. You believe there is a 10% chance the stock will drop by 10%, and you...
-
Locate the centroid of the plane area shown. 2= 150 mm r,= 75 mm
-
We are distilling a mixture that is \(10.0 \mathrm{~mol} \%\) methanol, \(20.0 \mathrm{~mol} \%\) ethanol, \(30.0 \mathrm{~mol} \% \mathrm{n}\)-propanol, and \(40.0 \mathrm{~mol} \%...
-
What account is debited when a partner withdraws supplies for personal use?
-
Statement On January 1, 2016, Kittson Company had a retained earnings balance of $218,600. It is subject to a 30% corporate income tax rate. During 2016, Kittson earned net income of $67,000, and the...
-
ou are evaluating a closed - end mutual fund and see that its price is different from its net asset value ( NAV ) . The fund has an expense ratio ( \ epsi ) of 2 . 8 0 % and a dividend yield ( \...
-
Quantitative Problem: Sunshine Smoothies Company (SSC) manufactures and distributes smoothies. SSC is considering the development of a new line of high-protein energy smoothies. sSC's CFO has...
-
Primitive Energy owns several coal seam gas reserves in south-west Queensland. As a relatively minor player in the Queensland Liquefied Natural Gas (LNG) market, Primitive does not have the capacity...
-
Suppose that f(x+h)-f(x) = 6hx -6hx-4h2x-3h + 4h. Find f'(x). f'(x)= || X
-
Give financial analysis of this start-up company. Financial Statements Purple Cloud Projected Income Statement* Purple Cloud Projected Interim Income Statement For Year Ending December 31, 20XX...
-
You are a manager with Hodges Jones & Sylvia ( the Firm ) and a member of the Firm s audit team for the audit of Bravo Corporation ( the Company ) . One hundred percent of the outstanding common...
-
Comparative financial statement data for Carmono Company follow: Assets Cash Accounts receivable Inventory Total current assets Property, plant, and equipment Less accumulated depreciation Net...
-
Evaluate the role of non-coding RNAs, such as microRNAs and long non-coding RNAs, in post-transcriptional gene regulation, cellular differentiation, and disease pathogenesis, highlighting their...
-
Critical values for quick reference during this activity. Confidence level Critical value 0.90 z* = 1.645 0.95 z* = 1.960 0.99 z* = 2.576 469062.3288744.qx3zqy7 Jump to level 1 A poll for a statewide...
-
Why are stocks usually more risky than bonds?
-
Delaware Chemical Company uses oil to produce two types of plastic products, P1 and P2. Deleware budgeted 25,000 barrels of oil for purchase in September for $72 per barrel. Direct labor budgeted in...
-
The data related to Acclaim Sporting Goods Company's factory overhead cost for the production of 50,000 units of product are as follows: Productive capacity at 100% of normal was 75,000 hours, and...
-
Satin Skin Lotion Company consists of two departments, Blending and Filling. The Filling Department received 480,000 ounces from the Blending Department. During the period, the Filling Department...
-
Decade, Inc., recorded certain capital stock transactions shown in the following journal entries: (1) issued common stock for \(\$ 25\) cash per share, (2) purchased treasury shares at \(\$ 40\) per...
-
Label each of the following characteristics of a corporation as either an (A) advantage or a (D) disadvantage: a. Limited liability b. Taxation c. Regulations d. Transferability of ownership
-
The following information relates to Ontario Components, Inc.: a. Calculate the company's return on common stockholders' equity for 2018 and 2019. b. Calculate the company's dividend yield for 2018...
Study smarter with the SolutionInn App