University of Mindanao

Panabo College
Acctg 2a
1st Examination
Test I - Multiple Choice Theory. No Erasures Allowed. 9. A partner who contributes his work, labor or
Direction: Select the best answer. Mark X the box of the industry to a common fund of the partnership
letter of your answer. is called
a. Limited partner
1. A partnership b. Capitalist partner
a. Is created by agreement of the c. Industrial partner
partners. d. Managing partner
b. Has a juridical personality separate and 10. The estimated price an asset that a seller is
distinct from that of each of the willing to sell and the buyer is also willing to buy
partners. in an open market?
c. May be constituted in any form, except a. Sound value
where immovable property or real b. Current value
property rights are contributed, in c. Fair market value
which case, the law requires that a d. Replacement value
public instrument be executed Test II - Multiple Choice Problem. (3 points each)
d. Is dissolved by death of a partner Direction: Read carefully each problem. Answer what is
e. All of the above required. Write the letter of your answer with solution
2. Which of the following is not a characteristic of starting from the second page of your answer sheet.
partnerships?
a. Ease of formation bonus 11. On May 1, 2015, Eve and Nur formed a
b. Mutual Agency partnership and agreed to share profits and
c. Unlimited Liability losses in the ratio of 3:7, respectively. Eve
d. Limited Life contributed a parcel of land that cost P10,000.
3. A partnership agreement should include Nur contributed P40,000 cash. The land was
a. Each partner’s duties. sold for P18,000 on May 1, 2015, immediately
b. The purpose of the business. after formation of the partnership. What
c. The method of allocating profits. amount should be recorded in Eve’s capital
d. All of these. account formation of the partnership?
4. In a limited partnership, a. P15,000
a. The general partners have limited b. P17,400
liability. c. P10,000
b. All partners have limited liability. d. P18,000
c. All, except general partners have Items 12-13
limited liability. On March 1, 2015, Zander and Giemar formed a
d. All, except general partners have partnership with each contributing the following assets:
unlimited liability. Zander Giemar
5. Non-cash asset invested into a partnership are Cash P400,000 P 600,000
recorded at Accounts Receivable 120,000
a. Zero Merchandise 50,000 60,000
b. The original cost Building 1,050,000
c. Their carrying value
d. Their fair market value As agreed, 10% allowance for uncollectible accounts
6. Partner’s agreement are contained in a/an- must be established. The building has a mortgage loan
a. By-laws balance of P300,000 which is to be assumed by the
b. Partner’s Diary partnership. The partners further agree on a ratio 3:2
c. Articles of Co-partnership as the basis for profit and loss distribution.
d. Articles of Incorporation 12. How much would the capital balance of Zander
7. The partnership agreement may be in the form right after the partnership formation?
of Not in the choices
a. Written contract a. P1,968,000
b. Oral contract b. P2,280,000
c. Implied agreement c. P2,370,000
d. Any of the above d. P2,450,000
8. The person who assumes full co-ownership of 13. Assuming that the mortgage loan balance is not
a partnership including unlimited liability is a assumed by the partnership, how much would
a. Sole proprietor be the capital contribution of Giemar?
b. Shareholder a. P1,430,000
c. Limited partner b. P1,710,000
d. General partner c. P1,810,000
 d. P1,950,000
14. On April 30, 2015, Lavelyn, Mary and Jean Items 18-20
formed a partnership by combining their
separate business proprietorships. Lavelyn On March 1, 2015, Israel and Richelle decided to
contributed cash of P50,000 . Mary contributed combine their businesses and form a partnership. Their
property with a P36,000 carrying amount, a statement of financial position on March 1, before
P40,000 original cost and P80,000 fair value. adjustments, showed the following:
The partnership assumed that the P35,000 Israel Richelle_
mortgage attached to the property. Jean Cash P 9,000 P 3,750
contributed equipment with a P30,0000 Accounts Receivable 18,500 13,500
carrying amount, a P75,000 original cost, and Inventories 30,000 19,500
P55,000 fair value. The partnership agreement Furniture and Fixtures (n) 30,000 9,000
specified that profits and losses are to be Office Equipment (n) 11,500 2,750
shared equally. Which partner has the largest Prepaid Expenses 6,375 3,000
April 30, 2015 capital account balance? Total P105,375 P51,500
a. Lavelyn
b. Mary Accounts Payable P 45,750 P18,000
c. Jean Capital 59,625 33,500
d. All capital account balance are equal. Total P105,375 P51,500
15. James and Kierk started a partnership. James
contributed a building that he purchased 10 They agreed to have the following items recorded in
years ago for P100,000. The accumulated their books:
depreciation on the building on the date of i. Provide 2% allowance for doubtful
formation is P25,000, and the fair value is accounts. Israel furniture and fixtures
P110,000. For what amount will James’ capital should be P31,000, while Richelle office
account be credited on the books of the equipment is under-depreciated by
partnership? P250.
a. P100,000 ii. Rent expense incurred previously by
b. P75,000 Israel was not yet recorded amounting
c. P110,000 to P1,000, while salary expense
d. P25,000 incurred by Richelle was not recorded
amounting to P800.
Items 16-17 iii. The fair market values of inventory
On August 1, Eve and Nur pooled their assets to form a amounted to:
partnership, with the firm to take over their business For Israel P29,500
assets and assume the liabilities. Partnership capitals For Richelle P21,000
are to be based on net assets transferred after the 18. Compute the net credit adjustment for Israel
following adjustments. Profits and losses are allocated and Richelle:
equally. Israel_ Richelle_
a. P2,870 P2,820
The inventory of Nur is to be increased by P4,000; an b. (P2,870) (P2,820)
allowance for doubtful accounts of P1,000 and P1,500 c. (P 870) P180
are to be set up in the books of Eve and Nur, d. P870 (P180)
respectively; and accounts payable of P4,000 is to be
recognized in Eve’s books. The individual trial balances 19. What is the amount of total liabilities after the
on August, before adjustments, follow formation?
Eve Nur a. P63,950
Assets P75,000 P113,000 b. P65,550
Liabilities 5,000 34,500 c. P63,750
d. P61,950
16. What is the capital of Eve after the above 20. What is the amount of total assets after the
adjusments? formation?
a. Eve, P68,750 a. P160,765
b. Eve, P65,000 b. P152,985
c. Eve, P65,000 c. P157,985
d. Eve, P75,000 d. P156,875
17. What is the capital of Eve after the above
adjusments? GOD BLESS!
marjorie c. librando, cpa
a. Nur, P77,500 Think about the multitude of decisions you will have to make during
b. Nur, P81,000 your lifetime. As a whole, they determine the course of your life. That is why it is so
important to seek the Lord’s guidance in your choices. After all, He is the only
c. Nur, P76,000 source of true wisdom. Whether the issue you are facing is major or minor, God
d. Nur, P81,000 knows best. By seeking His wisdom, you can live the best possible life without
suffering the fallout of foolish choices.
-Charles F. Stanley