Instructions: Please submit your answers with corresponding solutions to the case problems below: (5 points each)

1. Marcial and Juan formed a partnership. Marcial contributed a building that he purchased 5 years ago for
P100,000. The accumulated depreciation on the building on the date of formation of the partnership is
P25,000 and the fair value is P125,000. For what amount will Marcial’s capital account be credited on the
books of the partnership?
2-6. Tom admits Tubo to a partnership interest in his business. The following account balances of Tubo on January 1,
2022 show:
Cash
Merchandise Inventory
Accounts receivable
Equipment, net
Accounts Payable
Tubo, Capital
It is agreed that the following adjustments shall be made prior to the admission of Tubo:
1. Provide 2% allowance for uncollectible accounts.
2. Fair market values of the merchandise inventory and equipment are P100,000 and P50,000, respectively.
3. Other assets amounting to P5,000 are to be recognized.
4. Accrued expenses of P2,000 are to be recognized.
5. Liabilities are to be assumed by the partnership.
5. Profit and loss of Tom and Tubo shall be divided in the ratio of 2:1.
Tubo is to invest sufficient cash equivalent to 30% in the partnership.
Required: 2. What is the net (debit) credit adjustment of Tubo, capital?
3. How much is the total liabilities of Tubo before the formation of the partnership?
4. How much is the total capital of Tom before the formation of the partnership?
5. How much is the cash contributed by Tubo in the formation of a partnership?
6. How much is the total assets after the formation of the partnership?

7-9. Liscano and Veroy executed a partnership agreement that lists the following assets contributed at the
partnership formation. Liscano contributed cash of P 200,000 and furniture and fixtures with carrying cost of
P150,000, fair market value of P160,000 and acquisition cost of P200,000. Veroy contributed cash of P100,000,
Inventory of P50,000 and Building of P250,000. The building is subject to a mortgage of P50,000, which the
partnership has assumed.

Required: 7. What amount should be recorded as capital for Liscano and Veroy at the formation of the partnership?
8. What amount should be recorded as total assets of the partnership?
9. What amount should be recorded as total liabilities of the partnership?
10. See and Cinco formed a partnership. See contributed a building that she purchased 10 years ago for
P100,000. The accumulated depreciation on the building on the date of formation of the partnership is
P25,000 and the fair value is P150,000.
w: (5 points each)

10,000.00
90,000.00
30,000.00
70,000.00
50,000.00
150,000.00