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APC Ch3sol 2
APC Ch3sol 2
APC Ch3sol 2
Partnership Operations
E 3-1
1. Borres = 250/500 x P600,000 = P300,000
Buendia = 150/500 x P600,000 = P180,000
Bustos = 100/500 x P600,000 = P120,000
E 3-2
Income Summary 250,000
Banal, Capital 112,250
Benson, Capital 137,750
Banal Benson Total
10% Interest on average capital P 89,000 P114,500 P203,500
Remainder – divided equally 23,250 23,250 47,500
Total P112,250 P137,750 P250,000
E 3-3
Benito Bunye Total
a. Interest of 10% on excess average capital P 40,000 P 40,000
Salaries 300,000 P200,000 500,000
Remainder – divided in the ratio of 70:30 112,000 48,000 160,000
Total P452,000 P248,000 P 700,000
E 3-4
1. Blanco = 120/300 x P120,000 = P48,000; Banda = 180/300 x P120,000 = P72,000
E 3-5
1. Bueno Beran Total
Interest of 8% on beginning capital P 48,000 P 54,000 P102,000
Salaries to partners 225,000 115,000 340,000
Balance – divided 3:2 (40,200) (26,800) (67,000)
Total P232,800 P142,200 P375,000
2. Beran = P375,000 x 2/5 = P150,000; however, minimum guaranteed amount to Beran is P175,000
Bueno = P375,000 – P175,000 = P200,000
E 3-6
Net income after salaries, interest and bonus P322,000
Interest (P200,000 x 10%) P20,000
Salaries (8,000 x 12) 96,000 116,000
Net income before interest and salaries P438,000
Bonus rate x 25%
Amount of bonus to be credited to Basco P109,500
E 3-7
Income before income tax = P650,000 / 70% = P928,571
2. B = .05 (P928,571 – B)
= P46,428 / 1.05
= P44,217
3. B = .05 (P928,571 – T)
T = .30 (P928,571) = P278,571
B = .05 (P928,571 – P278,571)
= .05 (P650,000)
= P32,500
4. B = .05 (P928,571 – B – T)
T = .30 (P928,571) = P278,571
B = .05 (P928,571 – B – P278,571)
= .05 (P650,000 – B)
= P32,500 / 1.05
= P30,952
E 3-8
1. Balbin Bagtas Banta Total
Capital balances P240,000 P200,000 P200,000 P 640,000
Required capital 256,000 224,000 160,000 640,000
Cash received (paid) (P 16,000) (P 24,000) P 40,000 ----
Cash 160,000
Balbin, Capital 80,000
Bagtas, Capital 80 000
E 3-9
Drawings charged against capital P520,000
Less Additional investment 100,000
Decrease in capital P420,000
Less Net decrease in capital 240,000
Share in net income P 180,000
Profit share 25%
Net income of the partnership P720,000
P 3-1
1. Income Summary 300,000
Bondoc, Capital 180,000
Barba, Capital 120,000
Bondoc = P300,000 x 60% = P180,000
Barba = P300,000 x 40% = P120,000
P 3-2
1. Income Summary 350,000
Bernal, Capital 243,300
Burgos, Capital 106,700
Bernal Burgos Total
8% int. on beg. capital P 28,800 P 35,200 P 64,000
Balance – 3: 1 214,500 71,500 286,000
P243,300 P106,700 P350,000
2. Income Summary 350,000
Bernal, Capital 139,000
Burgos, Capital 211,000
Bernal Burgos Total
Salaries P 70,000 P130,000 P200,000
12% int. on ending capital 48,000 60,000 108,000
Balance – equally 21,000 21,000 42,000
P139,000 P211,000 P350,000
P 3-4
2. Sales 4,800,000
Cost of Goods Sold 2,100,000
Operating Expenses 1,000,000
Income Taxes 510,000
Income Summary 1,190,000
P 3-6
1. Net sales (P1,525,000 – P25,000) P1,500,000
Cost of goods sold:
Purchases P980,000
Less Merchandise inventory, end 305,000 675,000
Gross profit P 825,000
Operating expenses (300,000 – 12,500 – 5,000 + 17,500 + 30,000) 330,000
Income before income tax P 495,000
Income tax 148,500
Net income P 346,500
2. Brenda Brosas Total
Salaries (P150,000 x 8/12) P100,000 P100,000
Additional 10% of NI after salaries 24,650 24,650
Balance – original capital 138,656 P83,194 221,850
Total P263,306 P83,194 P346,500
P 3-7
Be on Top Company
Income Statement
For the Year Ended December 31, 2014
Sales P5,100,000
Cost of goods sold:
Purchases P4,920,000
Less: Purchase returns and allowances P 99,000
Purchase discounts 138,000 237,000
Cost of goods available for sale P4,683,000
Less Merchandise inventory, December 31 1,406,000 3,277,000
Gross profit P1,823,000
Other operating income – interest 27,000
Selling expenses (schedule 1) ( 530,300)
Administrative and general expenses (schedule 2) ( 801,800)
Operating income P 517,900
Interest expense ( 30,000)
Net income before Income Tax P487,900
Income Taxes 146,370
Net Income after Income Tax P 341,530
Be on Top Company
Statement of Financial Position
December 31, 2014
Assets
Current assets:
Cash P582,750
Notes receivable 120,000
Accounts receivable P186,000
Less Allowance for doubtful accounts 9,300 176,700
Interest receivable 6,000
Merchandise inventory 1,406,000
Prepaid taxes 10,000
Store supplies 16,500 P2,317,950
Noncurrent assets
Store furniture P222,000
Less Accumulated depreciation 21,300 200,700
Total assets P2,518,650
Liabilities and Capital
Current liabilities;
Notes payable P 360,000
Accounts payable 756,000
Advertising payable 9,500
Taxes payable 10,500
Interest payable 3,750
Income tax payable 146,370
Total liabilities P1,286,120
e. Taxes 10,500
Taxes Payable 10,500
Closing entries
a. Merchandise Inventory 1,406,000
Interest Revenue 27,000
Purchase Returns and Allowances 99,000
Purchase Discounts 138,000
Sales 5,100,000
Income Summary 6,770,000
P 3-9
1. Balmes = 5/10 x 80% = 40%
Bamban = 3/10 x 80% = 24%
Buela = 2/10 x 80% = 16%
Bagnes 20%
2. Corrected net income = P400,000 – ( P24,000 - P62,000 - P40,000 + P30,000 + P18,000
x 70%) = P379,000
Multiple Choice
1. C Jan. 1 – Mar. 31 P 80,000 x 3 = P 240,000
Apr. 1 – May 31 96,000 x 2 = 192,000
June 1 – Aug. 31 112,000 x 3 = 336,000
Sept. 1 – Dec. 31 72,000 x 4 = 288,000
P1,056,000 / 12 = P88,000
2. B Bañas Belda
Capital beg. P 120,000 P 118,000
Share in net loss (32,000) (16,000)
P88,000 P102,000
3. A Bernardo Belo
Salaries P 110,000 P 90,000
Balance – 60:40 (12,000) (8,000)
P98,000 P82,000
4. D Bustos
Net Profit P220,000
Bonus P220,000 x 10%/110% (20,000) 20,000
Interest P220,000 – P200,000 = P20,000 x 10% (2,000)
Salaries ( 44,000) 24,000
Balance P 154,000
Share of Bustos x 2/10 30,800
Total profit share of Bustos P74,800
5. B Banta:
Jan. 1 – June 30 P200,000 x 6 = P 1,200,000
Jul. 1 - Dec. 31 320,000 x 6 = 1,920,000
P 3,120,000 / 12 = P260,000 x 10% = P26,000
Borja:
Jan. 1 – Sept. 30 P450,000 x 9 = P4,050,000
Oct. 1 – Dec. 31 310,000 x 3 = 930,000
P4,980,000/12 = P415,000 x 10% = 41,500
P97,500
TM 10
1. F 5. T 9. F 13. T 17. T
2. F 6. F 10. T 14. T 18. F
3. T 7. T 11. T 15. F 19. T
4. T 8. T 12. T 16. T 20. T
TM 11
1. L 4. J 7. E 10. N 13. I
2. B 5. M 8. A 11. P 14 Q
3. K 6. D 9. O 12. G 15. C
TM 12
1. D
2. B
3. B
4. C
5. C
6. C Beltran Barba Total
Capital beginning P400,000 P500,000 P900,000
Share in net income-equally 200,000 200,000 400,000
Share in net loss – 2:1 ( 160,000) ( 80,000) ( 240,000)
Capital, end P440,000 P620,000 P1,060,000
TM 13
Problem A
Problem B
1.
Double B Partnership
Income Statement
For the Year Ended December 31, 2014
Sales P1,800,000
Cost of goods sold:
Inventory, January 1 P 800,000
Purchases 1,200,000
Cost of goods available for sale P2,000,000
Less Inventory, December 31 1,050,000 950,000
Gross profit P850,000
Operating expenses:
Depreciation – building P30,000
Depreciation – furniture and fixtures 30,000
Other operating expenses 300,000 360,000
Net income before Income Tax P490,000
Income Tax 147,000
Net Income after Income Tax P343,000
2. Net income is allocated as follows:
Bilbao Bragas Total
Salaries P240,000 P240,000 P480,000
Interest on beginning capital 75,000 62,000 137,000
Remainder -2:3 (109,600) (164,400) (274,000)
Total P205,400 P137,600 P343,000
Double B Partnership
Statement of Changes in Partners’ Equity
For the Year Ended December 31, 2014