1.A and B formed a partnership. The following are their contributions:

A

B

Cash

200,000

-

Accounts receivable

100,000

-

Inventory

160,000

-

Land

100,000

Building

240,000

Total

460,000

340,000

Note payable

120,000

A, capital

340,000

B, capital

340,000

Total

460,000

340,000

Additional information:

Included in accounts receivable is an account amounting to 40,000 which is deemed uncollectible.

The inventory has an estimated selling price of 200,000 and estimated costs to sell of 20,000.

An unpaid mortgage of 20,000 on the land is assumed by the partnership.

The building is under-depreciated by 50,000.

The building also has an unpaid mortgage amounting to 30,000, but the mortgage is not assumed by the partnership. B agreed to settle the mortgage using his personal funds.

The note payable is stated at face amount. A proper valuation requires the recognition of a 30,000 discount on note payable.

A and B shall share in profits and losses 60% and 40%, respectively.

Requirements:

a.Compute for the adjusted balances in the partners' capital accounts.

b.Assume that a partner's capital shall be increased accordingly by contributing additional cash to bring the partners' capital balances proportionate to their profit or loss ratio. Which partner should provide additional cash and how much is the additional cash contribution?

2.A and B agreed to form a partnership. A shall contribute 80,000 cash while B shall contribute 200,000 cash. However due to the expertise that A will be bringing to the partnership, the partners agreed that they should initially have an equal interest in the partnership capital.

Requirement: Using the bonus method, provide the journal entry to record the initial investments of the partners.

1. A and B formed a partnership. The following are their contributions: A B Cash 200,000 Accounts receivable 100,000 Inventory 160,000 Land 100,000 Building 240,000 Total 460,000 340,000 Note payable 120,000 A, capital 340,000 B, capital 340,000 Total 160,000 340,000 Additional information: Included in accounts receivable is an account amounting to F40,000 which is deemed uncollectible. The inventory has an estimated selling price of $200,000 and estimated costs to sell of P20,000. An unpaid mortgage of F20,000 on the land is assumed by the partnership. The building is under-depreciated by P50,000. The building also has an unpaid mortgage amounting to P30,000, but the mortgage is not assumed by the parmership. B agreed to settle the mortgage using his personal funds. The note payable is stated at face amount. A proper valuation requires the recognition of a P30,000 discount on note payable. A and B shall share in profits and losses 60% and 40%, respectively. Requirements: 3. Compute for the adjusted balances in the partners' capital accounts. b. Assume that a partner's capital shall be increased accordingly by contributing additional cash to bring the partners' capital balances proportionate to their profit or loss ratio. Which partner should provide additional cash and how much is the additional cash contribution