CITY COLLEGE OF

MIDTERM
CALAMBA
DEPARTMENT OF BUSINESS AND ACCOUNTANCY

PARTNERSHIP AND CORPORATION

MIDTERM – ACTIVITY 1

PARTNERSHIP DISSOLUTION

PROBLEM A.
Tina, Lou and Lena are partners sharing profits and losses in the ratio of
2:2:1 and have capital balances of P400,000, P400,000 and P200,000,
respectively. The following independent situations are given to you:
a) Rod purchases half of Lena's interest, paying her directly for an amount
that earned for her a profit of P50,000.
b) Rod pays P240,000 directly to the partners for a one-fourth share of the
partnership.
c) Rod pays P100,000 directly to Tina for one-third of her share in the
partnership. Partners agree that it is time to revalue the assets of the
partnership using as a basis the amount Rod is willing to pay.

Direction:
A. How much did Rod pay Lena in situation a? Record the admission of Rod.

b. How much is the gain or loss of the partners in situation b? Record Rod's
admission.

C. How much should the asset revaluation be in situation c? Make two entries
and prepare a revised partners' equity.

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