Chapter1aa1sol 2012

CHAPTER 1
Partnership Formation and Operations

EXERCISES
Exercise 1 1
Req. 1.
a.
Campos, Capital
Allowance for Uncollectible Accounts
14,000
14,000
Accumulated Depreciation
Campos, Capital
Furniture and Fixtures
b.
6,000
6,500
12,500
Goodwill
Campos, Capital
30,000
Cash (P83,500 x 1/2)

Tomas, Capital
To record contributions of Tomas
41,750
30,000
41,750
Req. 2.
Accounts Receivable
Inventory
Goodwill
Accounts Payable
Campos, Capital
60,000
100,000
7,500
30,000
24,000
90,000
83,500
Cash
Tomas, Capital
41,750
41,750
Req. 3.
Campos and Tomas Partnership
Statement of Financial Position
July 1, 2012
Assets
Cash
Accounts Recl
Less Allowance for
Uncol Accts.
Inventory
Furniture
Goodwill
TOTAL ASSETS
Liabilities & Owners Equity

P41,750
P60,000
24,000
Accounts Payable
Campos, Capital
Tomas, Capital
36,000
100,000
7,500
30,000
P215.250
P90,000
83,500
41,750
________
TOTAL LIABILITIES &
OWNERS EQUITY
P215,250
AA 1 - Chapter 1 (2012 edition)
page 2
Exercise 1-2
1.
2.
Cash
Accounts Receivable
Merchandise Inventory
Equipment
Accounts Payable
Notes Payable
Bernal, Capital
90,000
36,000
54,000
25,000
2,000
21,000
18,000
164,000
Cash
Camino,Capital(164,000/40%=410,000x60%=246,000)
246,000
246,000
Exercise 1 3
1.
2.
Cash
Land
Building
Legaspi, Capital
Sabino, Capital
800,000
540,000
900,000
Cash
Land
Building
Legaspi, Capital(2,240,000x40%)
Sabino, Capital(2,240,000x60%)
800,000
540,000
900,000
800,000
1,440,000
896,000
1,344,000
Exercise 1 - 4
1.
2.
Income Summary
Santos, Capital (P238,000 x 260/425)
Abad, Capital (P238,000 x 165/425)
238,000
Income Summary
Santos, Capital (P238,000 x 3,125/5,000)
Abad, Capital (P238,000 x 1,875/5,000)
Santos:
Jan. 1 Mar. 31
P260,000 x 3
Apr. 1 Apr. 30
290,000 x 1
May 1 July 31
360,000 x 3
Aug. 1 Dec. 31
320,000 x 5
238,000
Abad:
Jan. 1 May 31
June 1 Aug. 31
Sept.1 Dec. 31
3.
Income Summary
P165,000 x 5
215,000 x 3
195,000 x 4
145,600
92,400
148,750
89,250
P780,000
290,000
1,080,000
1,600,000
P3,750,000/12
P825,000
645,000
780,000
P2,250,000/12
P312,500
P187,500
238,000
page 3
Santos, Capital
Abad, Capital
147,750
90,250
Interest on ave. capital

Salaries to partners
Balance - equally
Net Profit
4.
Santos
P 18,750
150,000
( 21,000)
P 147,750
Abad
P
11,250
100,000
( 21,000)
P
90,250
Income Summary
Santos, Capital
Abad, Capital
238,000
164,840
73,160
Santos
Bonus to Santos
25% (P238,000 - B)
Interest of 6% on excess
average investment
6% (P312,500 - P187,500)
Balance - 3:2
Net Profit
5.
Total
P 30,000
250,000
(42,000)
P238 000
Abad
P 47,600
7,500
109,740
P 164,840
Income Summary
Santos, Capital (P238,000 x 15/25)
Abad, Capital (P238,000 x 10/25)
Total
P 47,600
73,160
P73,160
7,500
182,900
P238,000
238,000
142,800
95,200
Exercise 1 5
Sanchez and Gomez
Schedule of Distribution of Net Profit
December 31, 2012
Sanchez
Gomez
6% interest on average capital
P 6,246
P 14.440
10% bonus on net profit after interest
9,131
Salaries
20,000
30,000
Balance 70%, 30%
22,528
9,655
Net Profit
P57,905
P54,095
Computation of average capital:
Sanchez, Capital
Jan. 1
P81,600 x 3
P 244,800
Apr. 1
P111,600 x 9
1,004,400
P1,249,200
Ave. capital (P1,249,200/12)
P104,100
Jan. 1
Aug. 1
Total
P 20,686
9,131
50,000
32,183
P112,000
Gomez, Capital
P224,000 x 7
P1,568,000
P264,000 x 5
1,320,000
P2,888,000
Ave. capital (P2,888,000/12)
Computation of bonus: P160,000 x 70%= P112,000 P20,686 x 10% = P9,131
P240,667
page 4
2.
Sanchez and Gomez
Statement of Partners Capital
For the Year Ended December 31, 2012
Sanchez
P 81,600
30,000
57,905
( 41,600)
P127,905
Gomez
P224,000
40,000
54,095
( 41,600)
P276,495
Total
P305,600
70,000
112,000
( 83,200)
P404,400
Sanchez
P 6,246
9,131
37,356
P52,733
Gomez
P14.440
44,827
P59,267
Total
P 20,686
9,131
82,183
P112,000
8% interest on beg capital

Salaries
Balance 3:2
Net Profit
Mercado
P 48,000
225,000
( 38,700)
P234,300
Puzon
P 54.000
112,500
( 25,800)
P140,700
Total
P102,000
337,500
( 64,500)
P375,000
8% interest on beg capital

Balance Salary ratio
Net Profit
Mercado
P 48,000
182,000
P230,000
Puzon
P 54.000
91,000
P145,000
Total
P102,000
273,000
P375,000
Capital, January 1
Additional investment
Net profit
Drawings
Capital, December 31
3.
6% interest on average capital
10% bonus on net profit after interest
Net Profit
Exercise 1-6
1.
2.
3.
Puzon P375,000 x 2/3 = P150,000; however, minimum guaranteed amount is P160,000

Mercado P375,000 P160,000 = P215,000
Exercise 1 7
Net profit after salary, interest and bonus
Interest
P200,000 x 10%
Salary
P8,000 x 12
Net profit before interest and salary
Bonus rate
Amount of bonus to Lirio
Exercise 1 8
1. B = .25 x P500,000 = P125,000
2.
3.
B = .25 x P500,000 = P100,000

1.25
B = .25 (P500,000 - Tax)
P374,000
P20,000
96,000
116,000
P490,000
x 20%
P 98,000
page 5
T = .30 x P500,000 = P150,000

B = .25 (P500,000 P150,000)
B = P 87,500
4.
B
B
B
B
B
= .25 (P500,000 - B - Tax)

= .25 (P500,000 - B - P150,000)
= P87,500 - .25B
= P87,500/1.25
= P70,000
Exercise 1 - 9
1.
Estrella
Felipe
Salary
P40,000
P20,000
Bonus
6,000
4,000
Interest
10,000
9,000
Balance
26,900
26,900
Total
P82,900
P59,900
*B = 5% (P210,000 B) = P10,000
2.
Estrella
Felipe
Salary
P40,000
P20,000
Interest
10,000
9,000
Balance
( 43,100)
( 43,100)
Total
P 6,900
(P 14,100)
Garcia
P 4,000
26,900
P30,900
Jimenez
P 9,400
26,900
P36,300
Garcia
Jimenez
P 4,000
( 43,100)
(P39,100)
P 9,400
( 43,100)
(P33,700)
Felipe
Garcia
P 9,000
P 4,000
4,000
12,533
_______
P25,533
P 4,000
P37,600 x 2/ 6 = P12,533
Jimenez
P 9,400
Total
P 60,000
10,000*
32,400
107,600
P210,000
Total
P 60,000
32,400
(172,400)
(P 80,000)
3.
Estrella
Interest
P10,000
Bonus
6,000
Salary
25,067
Total
P41,067
*P37,600 x 4/ 6 = P25,067;
________
P 9,400
Total
P 32,400
10,000
37,600*
P 80,000
Exercise 1-10
1.
2.
Fees Earned
Joseph, Capital
Luis, Capital
Operating Expenses
Income Summary
750,000
50,000
Income Summary
Joseph Capital
Luis, Capital
Nicolas, Capital
500,000
200,000
100,000
500,000
150,000
250,000
100,000
page 6
Exercise 1 11
1.
Capital balances before payment
of cash
Required capital balances based on
on profit and loss ratio
Cash received (paid)
Benito
Cabral
Duenas
Total
P120,000
P100,000
P100,000
P320,000
128,000
(P 8,000)
112,000
(P 12,000)
80,000
P 20,000
320,000
-
Journal entry on the partnership books

Duenas, Capital
Benito, Capital
Cabral, Capital
20,000
8,000
12,000
2.
Benito
Cabral
Duenas
Total
Capital balances before additional
cash investment
P120,000
P100,000
P100,000
P320,000
Required capital balances based on
lowest possible cash investment*
160,000
140,000
100,000
400,000
Required additional cash investment P 40,000
P 40,000
P 80,000
* P120,000/40% = P300,000; P100,000/35% = P285,174; P100,000/25% = P400,000
Journal entry on the partnership books
Cash
Benito, Capital
Cabral, Capital
80,000
40,000
40,000
3.
Capital balances
Required capital
Additional investment(withdrawals)
Duenas, Capital
Cash
Cabral, Capital
Benito
P120,000
120,000
--------
Cabral
P100,000
105,000
5,000
Duenas
P100,000
75,000
(P 25,000)
Total
P320,000
300,000
P 20,000
25,000
20,000
5,000
page 7
Exercise 1 12
Enriquez and Flores
Schedule Showing Adjustments in Capital
Reported net profit
Adjustments:
Equipment purchased charged to expense
Depreciation on equipment
Overstatement of 2012 ending inventory
P400,000
P200,000
( 20,000)
( 24,000)
P156,000
x 70%
Corrected net profit
109,200
P509,200
Distribution of 2012 net profit

Salaries
Interest
Balance
Distribution of 2012 corrected net profit
Salaries
Interest
Balance
Adjustments
2.
Enriquez
P120,000
30,000
51,000
P201,000
Flores
P120,000
45,000
34,000
P199,000
Total
P240,000
75,000
85,000
P400,000
P120,000
30,000
116,520
P266,520
P 65,520
P120,000
45,000
77,680
P242,680
P 43,680
P240,000
75,000
194,200
P509,200
P109,200
Equipment
Enriquez, Capital
Flores, Capital
Inventory
Income Tax Payable
200,000
65,520
43,680
20,000
24,000
46,800
PROBLEMS
Problem 1 1
1.
a.
b.
c.
Merchandise, Inventory
Ruiz, Capital
60,000
Ruiz, Capital
30,000
Interest Receivable
Ruiz, Capital
P150,000 x 6% x 2/12 = P1,500
60,000
30,000
1,500
1,500
d.
e.
f.
g.
page 8
Ruiz, Capital
Interest Payable
P300,000 x 10% x 3/12 = P7,500
(date of note is Sept. 1, 2012)
Ruiz, Capital
Office Supplies
Ruiz, Capital
7,500
7,500
180,000
60,000
240,000
5,000
5,000
Cash
Santos, Capital
1,573,500
1,573,500
Ruiz and Santos
December 1, 2012
Assets
Cash
Notes Receivable
Accounts Receivable
Less Allowance for Uncollectible Accounts
Interest Receivable
Office Supplies
Total Assets
Liabilities and Capital
Notes Payable
Accounts Payable
Interest Payable
Total Liabilities
Ruiz, Capital
Santos, Capital
Total Capital
Total Liabilities and Capital
P
P900,000
90,000
1,813,500
150,000
810,000
1,500
300,000
5,000
480,000
P3,560,000
P300,000
630,000
7,500
P 937,500
P1,049,000
1,573,500
2,622,500
P3,560,000
Problem 1-2
1.
Cash
Tomas, Capital
518,000
1,152,000
Cash
Accounts Receivable
Office Equipment
Accounts Payable
Vicente, Capital
198,000
1,792,000
256,000
160,000
1,670,000
160,000
576,000
1,670,000
2.
page 9
Vicente, Capital
83,200
Vicente, Capital
Vicente, Capital
Office Equipment
64,000
64,000
96,000
96,000
Cash
Vicente, Capital
198,000
198,000
Cash
Tomas , Capital
3.
83,200
518,000
1,152,000
1,670,000
Tomas and Vicente
June 1, 2012
Assets
Cash
Accounts Receivable
Less Allowance for Uncollectible Accounts
Inventories
Office Equipment
Total Assets
Liabilities and Capital
Accounts Payable
Tomas, Capital
Vicente, Capital
P
P1,792,000
160,000
716,000
1,632,000
1,408,000
160,000
P3,916,000
P 576,000
P1,670,000
1,670,000
3,340,000
P3,916,000
Problem 1 3
1.
Goodwill
Equipment
Rosas, Capital
3,000
3,000
900
Cash
Accounts Receivable
Equipment
Goodwill
Accounts Payable
Perlas, Capital
5,000
46,000
108,000
12,000
9,000
3,000
1,000
2,000
3,900
4,000
54,000
125,000
2.
page 10
Cash
Accounts Receivable
Equipment
Goodwill
Accounts Payable
Perlas, Capital
5,000
46,000
108,000
12,000
9,000
3,000
Cash
Accounts Receivable
Equipment
Goodwill
Accounts Payable
Rosas, Capital
7,000
49,000
75,000
7,000
3,000
4,000
54,000
125,000
5,000
36,000
100,000
Problem 1 4
1.
Cash
Inventories
Equipment
Notes Payable
Serrano, Capital
Cash
Land
Mortgage Payable
Torres, Capital
900,000
1,500,000
3,000,000
1,050,000
4,350,000
600,000
6,000,000
1,950,000
4,650,000
Torres, Capital
Serrano, Capital
150,000
Purchases
Accounts Payable
900,000
Accounts Payable
Cash
720,000
Mortgage Payable
Interest Expense
Cash
300,000
120,000
Notes Payable
Interest Expense
Cash
225,000
75,000
Accounts Receivable
Sales
150,000
900,000
720,000
420,000
300,000
3,450,000
3,450,000
page 11
Cash
Accounts Receivable
3,150,000
3,150,000
Selling and General Expenses

Cash
Accrued expenses
870,000
Serrano, Drawing
Torres, Drawing
Cash
351,000
351,000
Income Tax
Income Tax Payable
175,500
630,000
150,000
90,000
702,000
175,500
Inventories, end
Sales
Inventories, beginning
Purchases
Interest Expense
Income Tax
Income Summary
600,000
3,450,000
1,500,000
900,000
870,000
195,000
175,500
409,500
Income Summary
Serrano, Capital
Torres, Capital
Interest on beginning capital
Salaries
Remainder 60%, 40%
Net Profit
Serrano, Capital
Torres, Capital
Serrano, Drawing
Torres, Drawing
409,500
209,700
199,800
Serrano
Torres
Total
P180,000
150,000
( 120,300)
P209,700
P180,000
100,000
( 80,200)
P199,800
P360,000
250,000
( 200,500)
P409,500
351,000
351,000
351,000
351,000
page 12
Serrano and Torres Partnership

Income Statement
Sales
Cost of Goods Sold:
Inventories, beginning
P1,500,000
Purchases
900,000
Cost of Goods Available for Sale
P2,400,000
Less Inventories, end
600,000
Gross Profit
Operating Income
Interest Expense
Net Profit before Income Tax
Income Tax
Net Profit
Serrano and Torres Partnership
December 31, 2012
Assets
Current Assets:
Cash
Accounts Receivable (P3,450,000 P3,150,000)
Inventories
Property, Plant and Equipment:
Land
Equipment
P3,000,000
Less Accumulated Depreciation
150,000
Total Assets
Liabilities
Current Liabilities:
Accounts Payable (P900,000 P720,000)
Accrued Expenses
Income Tax Payable
Long-term Liabilities:
Notes Payable (P1,050,000 P225,000)
Mortgage Payable (P1,950,000 P300,000)
Total Liabilities
P1,878,000
300,000
600,000
P3,450,000
1,800,000
P1,650,000
870,000
P 780,000
195,000
P 585,000
175,500
P 409,500
P 2,778,000
P6,000,000
2,850,000
P180,000
90,000
175,500
P 825,000
1,650,000
8,850,000
P11,628,000
455,500
2,475,000
P 2,920,500
Capital
Serrano, Capital
Torres, Capital
Total Capital
P4,358,700
4,348,800
8,707,500
P11,628,000
page 13
Problem 1 - 5
1. P2,700,000. (P200,000 + P1,100,000 + P500,000 + P1,500,000 P600,000) = P2,700,000
2. P2,600,000. (P2,500,000 + P2,700,000) / 2 = P2,600,000
3. P2,080,000. (P2,500,000 + P2,700,000)x 40% = P2,080,000
Problem 1 6
1.
Income Summary
Bernabe, Capital
Burgos, Capital
Interest on beg. capital
Balance 5:1
Net Profit
2.
Bernabe
P 28,800
530,000
P 558,800
Burgos
35,200
106,000
P 141,200
P
Bernabe:
Jan. 1 May 31
June 1 Oct. 31
Nov, 1 Dec. 31
Burgos:
Jan. 1 June 30
July 1 Oct. 31
Nov.1 Dec. 31
Income Summary
Bernabe, Capital
Burgos, Capital
Total
P 64,000
636,000
P700 000
700,000
236,000
464,000
Bernabe
P 140,000
48,000
48,000
P 236,000
Burgos
260,000
60,000
144,000
P 464,000
P
Income Summary
Bernabe, Capital
Burgos, Capital
Salaries
Interest on average. cap
Balance 1/3;2/3
Net Profit
4.
558,800
141,200
Income Summary
Bernabe, Capital
Burgos, Capital
Salaries
Interest on end capital
Balance 25%,75%
Net Profit
3.
700,000
Total
P400,000
P108,000
192,000
P700 000
700,000
252,400
447,600
Bernabe
P 90,000
49,000
113,400
P 252,400
P360,000 x 5
460,000 x 5
400,000 x 2
P440,000 x 6
360,000 x 4
500,000 x 2
Burgos
170,000
50,800
226,800
P 447,600
P
Total
P260,000
99,800
340,200
P700 000
P1,800,000
2,300,000
800,000
P4,900,000/12
P408,333
P2,640,000
1,440,000
1,000,000
P5,080,000/12
P423,333
700,000
299,250
400,750
Salaries
Interest on average. cap
Balance Equally
Net Profit
5.
page 14
Bernabe
P 100,000
40,833
158,417
P 299,250
Burgos
200,000
42,333
158,417
P 400,750
P
Income Summary
Bernabe, Capital
Burgos, Capital
Salaries
Interest on beg. cap
Bonus
Balance 2:3
Net Profit
B = 10%(NI S I)
Total
P300,000
83,166
316,834
P700 000
700,000
329,360
370,640
Bernabe
P 100,000
28,800
43,600
156,960
P 329,360
Burgos
100,000
35,200
235,440
370,640
Total
P220,000
64,000
43,600
392,400
P700 000
Problem 1 7
Tammy
P 12,000
48,000
( 44,700)
P 15,300
Manny
P 7,200
40,000
( 29,800)
P 17,400
Total
P 36,000
88,000
(149,000)
P(25,000)
P 12,000
48,000
3,000
P 63,000
7,200
40,000
2,000
P 49,200
P 36,000
88,000
10,000
P134,000
6% interest on capital
P 16,800
P 12,000
Salaries
48,000
Bonus
13,500
Balance 5:3:2
56,250
33,750
Net Profit
P 73,050
P107,250
B = (P250,000 P36,000 P88,000 P72,000)25% = P13,500
P 36,000
88,000
13,500
112,500
P250,000
1.
2.
Salaries
Balance 5:3:2
Net Profit
Salaries
Balance 5:3:2
Net Profit
Sandy
P 16,800
( 74,500)
P(57,700)
P 16,800
5,000
P 21,800
3.
7,200
40,000
22,500
P 69,700
Problem 1 - 8
1.
Salaries
20% bonus on net profit
Balance capital ratio
Net Profit
Delmar
P 2,500
12,000
23,800
44,500
P82,800
Pilar
P 1,500
8,000
26,700
P36,200
Total
4,000
20,000
23,800
71,200
P119,000
P
2.
page 15
Sales
Cost of Goods Sold
Operating Expenses
Income Taxes
Income Summary
480,000
Income Summary
Delmar, Capital
Pilar, Capital
119,000
210,000
100,000
51,000
119,000
82,800
36,200
Delmar, Capital
Pilar, Capital
Delmar, Drawing
Pilar, Drawing
6,000
10,000
6,000
10,000
Delmar and Pilar Company
Statement of Changes in Partners Capital
Capital balances, January 1, 2012

Add Distribution of net income for 2012:
Interests
Salaries
Bonus
Balance - capital ratio
Total share in net profit
Total
Less Drawings
Capital balances, December 31, 2012
Delmar
P 50,000
Pilar
P30,000
Total
P 80,000
P 1,500
8,000
2,500
12,000
23,800
44,500
P 82,800
P132,800
6,000
P126,800
26,700
P36,200
P66,200
10,000
P56,200
4,000
20,000
23,800
71,200
P119,000
P199,000
16,000
P183,000
Problem 1 - 9
Ramos, Gonzales and Martinez
For Three Years Ended December 31, 2012
Capital, January 1, 2010
Distribution of net loss (Sch. 1)
Withdrawals
Capital, December 31, 2010
Distribution of net profit (Sch. 2)
Withdrawals
Distribution of net profit (Sch. 3)
Withdrawals
Ramos
P 80,000
( 2,000)
(12,000)
P 66,000
7,960
(13,960)
P 60,000
21,840
(20,400)
P 61,440
Gonzales
P 48,000
( 1,520)
(14,480)
P 32,000
8,320
(16,320)
P 24,000
18,840
(24,000)
P 18,840
Martinez
P 40,000
( 2,000)
(16,000)
P 22,000
7,720
(17,720)
P12,000
18,120
(21,200)
P 8,920
Total
P 168,000
( 5,520)
(42,480)
P120,000
24,000
(48,000)
P 96,000
58,800
(65,600)
P 89,200
page 16
Schedule 1 - Distribution of 2010 net loss

Interest of 6% on beg. Capital
Balance equally
Net income
Ramos
P 9,600
4,800
(16,400)
P( 2,000)
Gonzales
P 12,000
2,880
(16,400)
P( 1,520)
Martinez
P 12,000
2,400
(16,400)
P( 2,000)
Total
P 33,600
10,080
P 49,200
P( 5,520)
Gonzales
P 12,000
1,920
( 5,600)
P 8,320
Martinez
P 12,000
1,320
( 5,600)
P 7,720
Total
P 33,600
7,200
(16,800)
P 24,000
Gonzales
P 12,000
1,440
Martinez
P 12,000
720
5,400
18,840
5,400
18,120
Total
P 33,600
5,760
3,240
16,200
58,800
Schedule 2 - Distribution of 2011 net profit

Balance equally
Net income
Ramos
P 9,600
3,960
( 5,600)
P 7,960
Schedule 3 - Distribution of 2012 net profit

Bonus - 20% (P58,800 - P39,360 - B)
Balance equally
Net income
Ramos
P 9,600
3,600
3,240
5,400
21,840
Problem 1 -10
Robles, Bernal and Reyes
Statement of Partners Capital
Robles
Capital balances before closing
the nominal accounts
Add Distribution of net profit:
Drawing allowance
Interest on average capital
Balance - 60%, 30%, 10%
Total
Deduct Cash distribution
Bernal
P120,000
P ( 2,000)
20,000
7,200
58,800
P206,000
122,720
P 83,280
14,000
240
29,400
P41,640
Reyes
P20,000
P41,640
P206,000 / 60% = P343,333;

P40,360 / 10% = P403,600
P41,640 / 30% = P138,800 (required total capital)
10,000
560
9,800
P40,360
26,480
P13,880
Total
P138,000
44,000
8,000
98,000
P288,000
149,200
P138,800
page 17
Problem 1- 11
Chavez, Roman, and Valdez
January 1 to November 1, 2012
Chavez
Loan
Beginning balances
Loan from Chavez
Transfer of equipment to Valdez
Balances
Distribution of loss on realization*
Salary to Valdez
Int. to Chavez for 7 months
Balance divided equally*
Balances
Dist. of cash in final settlement
Chavez
Capital
P 80,000
Roman
Capital
P 80,000
Valdez
Capital
P 80,000
P 80,000
P 80,000
( 16,000)
P 64,000
P 60,000
P 60,000
24,000
P 60,000
60,000
2,100
( 76,700)
P 5,400
5,400
( 76,700)
P 3,300
3,300
*Total partners equity as shown above

Less Cash available for distribution
Loss on realization
Less Salary and interest
Total loss to be divided equally
( 76,700)
P 11,300
11,300
Total
P240,000
60,000
( 16,000)
P284,000
24,000
2,100
( 230,100)
P 80,000
80,000
P284,000
80,000
P204,000
26,100
P230,100
Problem 1 - 12
Canlas, David, Estrella and Fajardo
Statement of Changes in Partners Capital Accounts
Investment
Net profit
Total
Less: Excess rent (P225 x 6)
Withdrawals
Uncollectible accounts
Capital, December 31
Canlas
P309,000
237,700
P546,700
David
P159,000
186,230
P345,230
P 78,000
18,000
P 96,000
P450,700
P 66,000
6,750
P 72,750
P272,480
Estrella
P327,000
140,310
P467,310
P 13,500
87,000
Fajardo
------P 24,010
P 24,010
P100,500
P366,810
P 37,500
P(13,490)
Supporting computations:
Revenue from fees
Expenses:
Total expenses, excluding depreciation and uncollectible
accounts (P290,000 - P13,500)
Depreciation [(P195,000 x 10%) + (P75,000 x 5%)
Doubtful accounts (P24,000 x 50%)
Net profit
P 37,500
Total
P 795,000
588,250
P1,383,250
P 13,500
268,500
24,750
P 306,750
P1,076,500
P 900,000
P 276,500
23,250
12,000
311,750
P588,250
page 18
Distribution of net profit

Canlas
20% of gross fees from respective
clients
20% of fees after April 1 after
expenses but before bad debts
Balance -Canlas-40%, David-35%,
Estrella-25%
Total
P 66,000
171,700
P237,700
David
P 36,000
150,230
P186,230
Estrella
Fajardo
P 33,000
107,310
P140,310
P135,000
P24,010*
24,010
P24,010
429,240
P588,250
Revenues
Expenses before uncollectible accounts (P276,500 + P23,250) x 180 / 900
Share of Fajardo
Problem 1-13
1. Equipment
Profit and Loss
2.
3.
4.
After April 1
P 180,000
59,950
P120,050
20%
P 24,010
13,500
1,350
12,150
Profit and Loss

Interest Payable
P87,500 x 6% x 10/12 = P4,375
4,375
4,375
Profit and Loss

Abaya, Capital
Reyes, Capital
Salaries
Bonus [25% x (NI B S) ]
Balance equally
Total
Total
159,025
63,700
95,505
Abaya
P 39,000
24,610
P 63,610
Abaya, Capital
Reyes, Capital
Abaya, Drawing
Reyes, Drawing
Reyes
P 58,500
12,305
24,610
P 95,415
Total
P 97,500
12,305
49,220
P159,025
36,000
62,500
36,000
62,500
Problem 1-14
1.
Jaime = 5/10 x 80% = 40%

Madrid = 3/10 x 80% = 24%
2.
Corrected net income = P250,000 (P12,000 P31,000 P20,000 + P15,000 + P9,000 x

70%) = P239,500
Jaime = P239,500 x 40% = P95,800
Madrid = P239,500 x 24% = P57,480
Soriano = 2/10 x 80% = 16%

Matias = 20%
Soriano = P239,500 x 16% = P38,320

Matias = P239,500 x 20% = P47,900
page 19
MULTIPLE CHOICE
1.
2.
3.
4.
D
D
A
C
Abena MV Cost (P90,000 P60,000)
Buendia MV Cost (P30,000 P40,000)
Actual
Inequity
5.
6.
7.
8.
D
C
C
B
Total
P30,000
( 10,000)
P20,000
( 20,000)
P 0
Molinas contribution (P190,000 P60,000)

Nuevos tangible contribution
Total capital contributions
Capital credit of Molina
Contribution of Molina
Bonus to Molina
Abena
(60%)
P18,000
( 6,000)
P12,000
( 30,000)
(P18,000)
P130,000
100,000
P230,000
x 60%
P 138,000
130,000
P
8,000
9.
Roxas = P596,250 - P5,550 = P590,700

Bernardo = P335,000 - P4,050 - P9,000 = P321,950
10.
Roxas = (P590,700 + P321,950) x 60% = P547,590

Bernardo = (P590,700 + P321,950) x 40% = P365,060
11.
Roxas = P650,000 P590,700 = P59,300

Bernardo = P400,000 P321,950 = P78,050
12.
Bruno = P150,000 - P90,000 = P60,000
13.
Total assets = Total liab. + Total capital

= P25,000 + P300,000 = P325,000
14.
Cash contribution = (P248,850 x 1/3) P50,000 = P32,950
15.
Total capital = (P158,400 + P17,500 P5,000 P5,000) 2/3 = P248,850
16.
Required capital of Esteban

(P115,000/40%=P287,500 x 60%)
Non-cash contributions of Esteban (P125,000 P30,000)
Cash contribution
P172,500
Contribution of Diaz
Contribution of Esteban (P125,000 P30,000 + P50,000)
Total partnership capital
P115,000
145,000
P260,000
17.
Buendia
(40%)
P12,000
( 4,000)
P 8,000
10,000
P18,000
95,000
P 77,500
page 20
18.
P115,000 + P95,000 = P210,000/2
P105,000
19.
Net increase (decrease) in capital

Add Withdrawals
Total
Less Additional investments
Profit share
Profit share percentage
Total partnership net profit
(P120,000)
260,000
(P140,000)
50,000
P 90,000
30%
P300,000
20.
21.
22.
C
B
C
Net profit (exclusive of salary, interest and bonus)

Salary (P2,000 x 12)
Interest (P50,000 x 5%)
Net profit after deduction of bonus
Bonus = .20 (P120,000 + Bonus) = P24,000 + .20 Bonus
= P24,000/.80 = P30,000
P 93,500
24,000
2,500
P120,000
23.
24.
D
B
10% x P1,000,000
20% x P1,500,000
5% (P1M P400,000)
Balance equally
Net income
25.
Alberto
P 100,000
300,000
680,000
P1,080,000
A
Interest
Salaries
Balance equally
26.
Sison
Bonus - 10%(P44,000 - B)
Interest on capital
in excess of P100,000
Balance - 4:4:2
27.
Ramos
P24,000
60,000
( 70,000)
P14,000
Cancio
P30,000
680,000
P30,000
680,000
Campos
P12,000
40,000
(70,000)
Torres
Ocampo
P 8,000
( 70,000)
6,800
Torres
(1,200)
Total
P 44,000
100,000
( 210,000)
(P66,000)
Total
P 4,000
12,000
3,400
P19,400
1,000
22,000
17,000
P44,000
Velasco
P 2,000
Total
P 2,000
12,000
(600)
P13,400
1,000
22,000
(3,000)
P22,000
P 1,000
P10,000
(1,200)
Total
P 100,000
300,000
60,000
2,040,000
Velasco
P 4,000
P 1,000
P10,000
6,800
Sison
Bonus - 10%(P22,000 - B)
Interest on capital
Balance - 4:4:2
Bustos
28.
Sison
Bonus - 10%(P22,000 - B)
Interest on capital
29.
page 21
Torres
Velasco
P 2,000
Total
P 2,000
10,364
P12,364
1,000
19,000
P22,000
P 1,000
P8,636
Average capital of Tamayo

P100,000 x 6 = P 600,000
160,000 x 6 = 960,000
P1,560,000/12
P130,000
Average capital of Vidal

P225,000 x 9 = P2,025,000
155,000 x 3 =
465,000
P2,490,000/12
P207,500
Average capital of Banson - P150,000

Total int. on ave. capital= (P130,000 + P207,500 + P150,000) 10%
= P48,750
30.
Interest on ave. capital

Balance - divided equally
31.
Total capital before net income

(P475,000 + P60,000 P70,000)
Add Net profit
Total capital, Dec. 31, 2008
32.
D
Int. on average capital
Balance - equally
Net increase (decrease)
P 48,750
144,000
9,000
P 201,750
Andal
P 47,250
122,325
(139,308)
P 30,267
P465,000
201,750
P666,750
Briones
P 23,865
(139,308)
P(115,443)
Camba
P 16,235
82,625
(139,308)
P( 40,448)
Total
P 87,350
204,950
(417,924)
P(125,624)
33.
Net income = Net sales - CGS - Depr. - Oper. exp. Others)

= P228,000- P123,000- P7,500- P58,100*=P39,400 x 70%
P27,580
*P60,000- P2,500- P950+ P1,550 = P58,100
**(P27,580 P10,000) x 10% = P1,758
Mariano
Lucas
total
Salary to partner for 10 mos.
P10,000
P 10,000
Bonus to managing partner
1,758
1,758
Balance based on orig. cap.
9,889
P 5,933
15,822
TOTAL share in profit
P 21,647
P 5,933
P 27,580
34.
TOTAL share in profit

Add Capital, beginning
TOTAL
Less Withdrawals
Capital, end
P 21,647
125,000
P146,647
20,000
P126,647
P 5,933
75,000
P 80,933
30,000
P 50,933
P 27,580
200,000
P 227,580
50,000
P 177,580
35.
36.
37.
38.
A
C
B
page 22
Belen
Interest
Salaries
Balance
Addl profit
for Edna
Net profit
Lorna
Ursula
P 5,000.00
10,000.00
10,000.00
P 2,500.00
6,000.00
10,000.00
P 2,500.00
P2,000.00
6,666.67
6,666.67
P12,000.00
16,000.00
33,333.34
________
P25,000.00
________
P18,500.00
_________
P9,166.67
3,333.33
P12,000.00
3,333.33
P64,666.67
D
Salaries
Bonus
Interest
Balance
Total
Puno
P40,000
13,000
1,000
7,000
P61,000
Computation of average capital:

Puno, capital
Jan. 1 P10,000 x 3
Apr 1 9,000 x 3
July 1 - 11,000 x 3
Oct. 1 - 10,000 x 3
Quirino, capital
Jan. 1 P 6,000 x 6
July 1 - 10,000 x 3
Oct. 1 - 8,000 x 3
Romero, capital
Jan. 1 P40,000 x 3
Apr. 1 - 38,000 x 3
July 1 - 53,000 x 6
Edna
Quirino
P36,000
Romero
P13,650
750
7,000
P43,750
4,600
7,000
P25,200
Total
Total
P 89,650
13,000
6,350
21,000
P130,000
P 30,000
27,000
33,000
30,000
P120,000 / 12
P10,000
P 36,000
30,000
24,000
P 90,000 / 12
P 7,500
P120,000
114,000
318,000
P552,00 / 12
P46,000
Let X = Net Income

P40,000 + 10% X + P1,000 + 1/3 (X P89,650 10% X P6,350 = P61,000
P40,000 + 10% X + P1,000 + 1/3 (90% X P96,000) = P61,000
P40,000 + 10% X + P1,000 + 30% X P32,000 = P61,000
10% X + 30% X = P61,000 P40,000 P1,000 + P32,000
40% X = P52,000
X = P130,000
39.
Legarda- 5/10 x 80% = 40%

Madrigal-3/10 x 80% = 24%
Sotto - 2/10 x 80% = 16%

Pimentel 20%
40.
Share of Legarda = P25,000 ( P1,200 - P3,100 - P2,000 + P1,500 + P900

= P1,500 x 70% = P1,050) = P23,950 x 40% = P9,580

Chapter1aa1sol 2012

Hochgeladen von

Dokumentinformationen

Originaltitel

Copyright

Verfügbare Formate

Dieses Dokument teilen

Dokument teilen oder einbetten

Freigabeoptionen

Stufen Sie dieses Dokument als nützlich ein?

Sind diese Inhalte unangemessen?

Copyright:

Verfügbare Formate

Chapter1aa1sol 2012

Hochgeladen von

Copyright:

Verfügbare Formate

CHAPTER 1

Partnership Formation and Operations

Cash (P83,500 x 1/2)

Liabilities & Owners Equity

AA 1 - Chapter 1 (2012 edition)

AA 1 - Chapter 1 (2012 edition)

Interest on ave. capital

Ave. capital (P2,888,000/12)

Computation of bonus: P160,000 x 70%= P112,000 P20,686 x 10% = P9,131

AA 1 - Chapter 1 (2012 edition)

8% interest on beg capital

8% interest on beg capital

Puzon P375,000 x 2/3 = P150,000; however, minimum guaranteed amount is P160,000

B = .25 x P500,000 = P100,000

AA 1 - Chapter 1 (2012 edition)

T = .30 x P500,000 = P150,000

= .25 (P500,000 - B - Tax)

AA 1 - Chapter 1 (2012 edition)

Journal entry on the partnership books

AA 1 - Chapter 1 (2012 edition)

Corrected net profit

Distribution of 2012 net profit

AA 1 - Chapter 1 (2012 edition)

AA 1 - Chapter 1 (2012 edition)

AA 1 - Chapter 1 (2012 edition)

AA 1 - Chapter 1 (2012 edition)

Selling and General Expenses

AA 1 - Chapter 1 (2012 edition)

Serrano and Torres Partnership

AA 1 - Chapter 1 (2012 edition)

AA 1 - Chapter 1 (2012 edition)

AA 1 - Chapter 1 (2012 edition)

Capital balances, January 1, 2012

AA 1 - Chapter 1 (2012 edition)

Schedule 1 - Distribution of 2010 net loss

Schedule 2 - Distribution of 2011 net profit

Schedule 3 - Distribution of 2012 net profit

P206,000 / 60% = P343,333;

AA 1 - Chapter 1 (2012 edition)

*Total partners equity as shown above

AA 1 - Chapter 1 (2012 edition)

Distribution of net profit

Profit and Loss

Profit and Loss

Jaime = 5/10 x 80% = 40%

Corrected net income = P250,000 (P12,000 P31,000 P20,000 + P15,000 + P9,000 x

Soriano = 2/10 x 80% = 16%

Soriano = P239,500 x 16% = P38,320

AA 1 - Chapter 1 (2012 edition)

Molinas contribution (P190,000 P60,000)

Roxas = P596,250 - P5,550 = P590,700

Roxas = (P590,700 + P321,950) x 60% = P547,590

Roxas = P650,000 P590,700 = P59,300

Bruno = P150,000 - P90,000 = P60,000

Total assets = Total liab. + Total capital

Cash contribution = (P248,850 x 1/3) P50,000 = P32,950

Total capital = (P158,400 + P17,500 P5,000 P5,000) 2/3 = P248,850

Required capital of Esteban

AA 1 - Chapter 1 (2012 edition)

P115,000 + P95,000 = P210,000/2

Net increase (decrease) in capital

Net profit (exclusive of salary, interest and bonus)

AA 1 - Chapter 1 (2012 edition)