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Ast Answer Shere Partnership Formation
Ast Answer Shere Partnership Formation
$8
KR Totol
15. (c)
P3O,.000 P 90.000
P&0.000
12000 42,000
Solory 30,000
interest
60.000 50,000
Bolonce or Residuol profM P282,000 (c)
a, oltemativety:
PAO,000 P25.000 + .10 (NI - sakories -bonus)
PA0,000 P25,000 +.10 [NI -(PIC,000 +P25,000) - P15,000]
P40.000 P25,000 + .10 (NI - Pi40,000]
P40,000 P25.000 +.10 NI - Pl4,000
P40,000 PIl,000 +.10 NI
P29,000 .10 N!
NI P290.000 (b)
39
Partnership
18. (d)
20. (c)
The weighted-qveroge copital is computed as tokows
January l- July I PA20,000xó months P2.520.0o0
Juty I-August 1 PS40.000xl month S40.000
August - December 31 P495.000 x S months 2475.000
P3.535,Q00
Divided by.. 12 months
EE:
/|- 6/1:P25,000x5 PI25,000
6/1 - 9/1 :P35,000 x3. I05,000
9/1 - 10/l:P32000 xI 32.000
10/1- 12/1 : P31,.000 x2 62,000
12/1 - 12/31 : P36,000 x I 36,000
P360,000
Divided by: 12 months
Weighted - average copital. P 30.000
61
Partnershup
P 60.000
B8: P20,000 x 3 =
PI0,000 x 2 = 20 /000
P 8,000 x S = 40,000
Pl20.00Q
= PI2,000 x8%x 10/12 PEOO
Coptal: Pl20,D00 / 10 PIO.000
10-Month AverogeCapial: x 8% = P800
PI2O,000 / 12 =
Annual Averoge
26. (b)
copital would be:
The annuai weighted averoge
' Morch i: PSO,000 x 3 PI50,000
210,000
June l: PZ0,000 x 3
Septermber I: P65,000x 4. 260,000
Divided by: Months per onnum
12P620,000
months
P 51667 (b)
The folowing Only
1. 000 noted:
PS, be
should withdrowols should be deducted from capitat to compute
overoge copitol.
2 The guestion is bosed on annual. therefore the denominator should be
welve (12) months. However,10 the 10-month weighted averoge capita
months)
would be P62,000 (P620,000
27. (o)
The weighted averoge copital would be:
WW:
January PI00,000 x6 (Jan. -Jun.) P 600,000
Juty P 88.000 *1 (Jutyl 88,000
August P128.000 x5 (Aug. - Cec.) 640.000
PI,328,000
Divided by: Months per annum 12 monhs
P I10,667 (a]
It should be noted that the number of months in the
computation includes the
curent month (before the dote of investment or dgte of withdrawal)
should stort ot the beginning of the month (iet's soy June 3, since the counting
June should be included in the counting to compute the therefore the month of
PIO0,000). overoge copitai for the
RR:
Janvary PI20.000 x5 (Jon. - May) P 600.000
June P105,000 x 5 (June - Oct.)
November 525.00)
P155,000 x 2(NOv. - Dec.) 310,000
Divided by: Months per unnum PI,435,000
12 months
Drawings are ignored as stated in the P 19,583 (o)
problem.
63
l'artnership
28. (d) HH
MM AA Total
P200,000 P250.000 P600,000
Copital. Janvory , 2015. PI50,000 50,000
Add Investment 30.000 20,000
60,760 i76,000
Net Income 53,180 62,060
P282,060 P310.760 P826.000
Tota! P233,180
10.000 30.000 50,000
Less: W#hdrawals 10.000
P223,180 P272,060 P280,760 P776,000 (d)
Capitol, December 31, 2015
MM AA Total
HH
P 18.000 P 12.000 P 54,000
Salary P 24,000
Interest on Average Capita
HH: 12%x Pl62,500 19,500
24,700
MM: 12% xP205,833 29,400 73,600
AA: 12%x P245,000. 19,360 48.400
Balance:2:4:4 9.680 19.350
P 53,180 P62,060 P 60,760 PI76.000
"Average Capi#als:
HH:
P 900.000
1/1-7/| : P150.000 x6 540.000
7/1 - 10/1: P180,000 x3
10/1 - 12/31 :P170,000 x 3 510.000
P 1,950,000
12 rmonths
Divided by: Months per annum
162.500
Weighted-average copital.
MM:
i/1 - 8/I:P200,000 x7 P400.000
8/1 - 10/1 : P220,000 x 2 440.000
10/1 - 12/31 : P210,000 x 3 630.000
2,470.000
Divided by: Months per annum 12 months
Weighted-average copita P 205.833
AA:
1/1-11/1: P250.00 x10 p 2,300.000
1/1-12/31 : P220.000 x 2... 440.000
P 2.940,000
Divided by: Months per annum 12 months
29. (a)
P(2.600,000)
500,000
Withdrawots
Investment
(bokoncing figure)
900.000
Share in net income P(L.200,000)
Net (dececse) ingease P3,000,000 (o]
the partnership: P90.000, 30%
Net income of
and bonus) bonut
30. (c} before soiornies. interest
andbonus t solories + interest +
Bonus .15 (NI sokoies, interest P200,000) + B)
15 (NI Ofter (P5.000 x 12) + (5%x
(P32000 P60.000+ PI0.000+ 8]
15 P32000+
.15 [PI02.000+ 8)
.15
P15.300.158
.15B = P15.300
85 8= P15.300
B= P15,300/ 85
B = Pl8.000 (c)
D Totol
31. (d)
Pl.250 PI,000 P 6,000
P 2.500 Pl.250
5% interest on cepital 5,000 3.000 3,333
8,000
Salaries 5.000 5.000 3,333
1,667
16.666
Boionce (3:32-2) 1,667
Aodifional proft.
PI2.500 P9,250 P4,.583 P6,000
P32,333 (d)
P2.500
A :P50,000 x 5%= 1.250
B:P25,000 x5% =
C:P25,000 x5% = 1250
I000
D :P20,000 x 5%=
Commds
First, determine who amnong theAApartners wil receive a fixed omount, then, share in h
PI2500- P2,500 - P5.000 resulting to ß
for the residuo amount, ie. for of AA represernts 30%, therefore
residua profits of P5,000. The P5,000 shore in residual profits allocoted to oll partners boses
copitalze P5.000 by 30% to arive ot Pló.666 which wil be
on thet profit and ioss ratio.
Second, determine who among the partners will receive o minimum amount, Any
portner who receives an omount lower than the minimum amount is reguired to have
an odditiongl profit, ie. for portner DD, which in DD's case PI,667 is needed to satisty
the minimum omount provided therein. Any partner who receive an amount equo.
or more than the minirmum amount obviousiy does not need on gdditionol profit.
32. (a)
AA B8 CC Total
10% Interest on average copitar P47.250 P 23.865 P 16.235 P 87,350
Salaries 122,325 82,625 204.950
Baiance: equoly (139.308) (139,308) (139,3O8) (417.924)
Increase (decrease). P30.267 P{115,443) P{40,448) P(125,624) (o!
AA: 10% xP472,500 = P47,250
88: 10%xP238,650 = P23,865
CC: 10% xPi62,350 = Pl6,235
65
Partnership
Fees
P180.000
96.000
Less:.Expenses
P 84.000
37. (d)
net income: PP
Corecting the oliocated
RR
P 3,000
Total
P 3,000 P 6.000*
income, equally 9,750 9,750
Corect allocation of net per books, equaity 19,500
Aliocation of net incoe
Adjustments increased (decreosed) P(6.750) P{6,750) P13,500 (d!
recorded in the ood
noted that the Pi9,500 waS erroneouslynecessory to reflect the
# shouid be Iooking for are cdjustments
books: what we ore simply
ollocafion of net incCome.
be:
"The adjusted/corected net income for 2015 would
income (per books) P19,500
Unadjustea Net
Add (deduct): odjustments
Understaternent of depreciafion (2,100)
Overstatenent of ending inventory (1,400)
Adjusted net income P6,000
38. (c) 2015 2016
39. (b)
() Profit and loss ratio:
New
Old
90% 45%
MM 50% 27%
NN 30% X
18%
20%
PP 10% 10%
100% 100% (D)
100%
Pi2.500
(2) Reported Net Income
Add (deduct): adjustments 800)
Prepaid expense - 2015
b. AccrUed expense - 2016
600)
700
Cc. Unearned income - 2015
500
d. ÁCcrued income - 2016
P12.300
Adjusied Net Income 18%
Multiply by: P &L ratio of 00
P 2.214 (b
Share of GO in et income
indicotes the exDense was
a. Omission of prepaid expense at the end of 2015 understating
thereby
recognized when paid in 2015 and not when used in 2016,
fhe expenses and overstating income in 2016. understate epenses ond overstale
b. Omission of accrued expense at the end of 2016
income. wus recognized
C. Cmission of uneamed income at the end of 2015 indicotes incomeunderstating the
thereby
when received in 2015 and not when earned in 2016,
2016 income.
income.
d. Omission of gccrued income at the end ot 2016 understate
P4,000 P4,000
Bonus®.
Interest: 10% (Pl10,000- Pl00,000) PI.000 1,000
Pl0,000 12000 22 000
Salaries
3400 17 000
Balance: 4:4:2.
PI9.400 P44.000 {c)
Z: P225,000 x 9 = P2.025.000
P155,000 x3 465.000
P2,490.0o00 12 = P207.500
42. (a)
Frst 6 mnonths X
Eovally 100.000 0Õ. 000 Total
200,000
Second 6 months
Bad debts expense (equaily) (20,000) (20,000) (40.000)
Baiance (40%:40%:20%) 136.000 136,000 68,000 340,000
300,000
Share in profit 216.000 500,000
43. (a)
First 6 months
I Ioto!
Salaries 15,000 15,000
Balance (60%:40%) 96.000 64,000 l60,000
175,000
Second 6months
Salaries 25,000 25.000
Balance (40%:40%:20%) 60,000 60.000 30.000 150,000
175,000
196.000 124,000 30,000 350,000
Eventy means overage
69
Partnership
P233.000
Sales 5,000
Less: Sales returns....
P228.000
Net Saies
Less: Cost of goods 'sold: -0
Inventory, March 1 196.000
Add: Purchasas...
P196.000
Cost of goods avgilable for sale 123.000
Less: Inventory, December 31 73.000
P105.000
Gross profit
Less: Operoting Expenses (P60,000- P2,500- P950 65,600
+ PI,550+ (20% x P45,000 x 10/121]
P 39,400
Net Income
45. (d)
bons tom he new pomer,
The bonus method impled that the old parmer. ether received a
CC, the new pantner invested on
or they paid a bonus to the neW portner. In this case, Accorgingy. the excess
amount in excesS of the omount credited to CC's copiia account.
treated as an odstent
should be treated as a bonus to AA and B8. Ths bonus shouo be
using AA ond B8's clc
to the old partners' copital occounts and shouid be aocoted by
profit and loss ratio.
Chapter
70
oovontoge when
46. (b) a geater
Ff wal have the bonus ond oso
tot- there sC
Whether there isa orofit
profit, FF wil obtoin a 205
oro os
bonus on profis
hand
before
will receve ony
08 o the t0tthethe
profit olfer
on ihe other
profit ofter the bonus.exomole us trates ths
bonus. The foliowing Protit
40% 603
P&Lrotio 200
200
800
20% Bonus 320 480
Share in profit 480 L,000
Tota! distribution 520
since FF hos o
sMoller percentoge shore in the
seen.
con eoy be
case ofo oss
Ioss.
70.000
Betty. copitol (Pi40.000 x 50% 70.000
Yessir, capita
Betht
The amount of the copitol hove based s equo fo fhe recorded omount of
copito at the time of the ossignment, ond it s incependent of the consideration
received by Betty for her 50% interest. the recorded omont of Betty's is P70.000
then the omount of the ronsfer entry is P70.000. regardles of whether Yessir poys
Betty P70. 000 or some other amount. Therelore. the.copita of the portnership after
the ossignment of interest remoins the some ot P400.000.
49. (b)
No googw btobe recognized in cases of adnission of new patner (refer to NO. S53 for tther
discussion) therefore. book voiue method is used.