Question
1. W, a senior partner in an accounting firm, has a profit share of 40% and 30% interest in 20x7. During 20x7, W withdrew P160,000
1. W, a senior partner in an accounting firm, has a profit share of 40% and 30% interest in 20x7. During 20x7, W withdrew P160,000 against his capital but invested property with a fair value of P70,000. If W's ending capital is P80,000 lesser than his capital beginning, how much is the partnership net income or net loss for 20x7?
Select one:
a. (P25,00)
b. (P10,000)
c. P25,000
d. P10,000
2. Under the partnership agreement, J is to receive a bonus of 20% of net income after bonus and remainder to be distributed as follows: 35% each to J and K and 30% to L.
If the partnerships net income is P318,000, Js share is
Select one:
a. P147,750
b. P79,500
c. P92,750
d. P132,500
3. Jessup Construction, Inc. has consistently used the percentage-of-completion method of recognizing income. During 2008, Jessup started work on a P1,500,000 fixed-price construction contract. The accounting records disclosed the following data for the year ended December 31, 20x7:
Costs incurred | 465,000 |
Estimated cost to complete | 1,085,000 |
Progress billings | 550,000 |
Collections | 350,000 |
How much loss should Jessup have recognized in 20x7?
Select one:
a. P15,000
b. P50,000
c. P100,000
d. P85,000
4. C & J Construction, Inc. has consistently used the percentage-of-completion method of recognizing income. Last year C & J started work on a P4,500,000 construction contract, which was completed this year. The accounting records disclosed the following data for last year:
Progress billings | 1,650,000 |
Costs incurred | 1,350,000 |
Collections | 1,050,000 |
Estimated cost to complete | 2,700,000 |
How much income should C & J have recognized on this contract last year?
Select one:
a. P150,000
b. P105,000
c. P350,000
d. P300,000
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