CHAPTER 12 PROBLEM SOLVING PART 2

MUCH BETTER IF THERE ARE EXPLANATION :)

12-28 | Basic Financial Accounting and Reporting by Prof. WIN Ballada NAME: SCORE: SECTION: PROFESSOR: Problem #1 Partner's Original Investment Froilan Labausa contributed land, inventory, and P280,000 cash to a partnership. The land has a book value of P650,000 and a market value of P1,350,000. The inventory has a book value of P600,000 and a market value of P510,000. The partnership also assumed a P350,000 note payable owed by Labausa that was used to purchase the land. Rosalie Balhag agreed to put up cash equivalent to Labausa's net investment. Required: Prepare the journal entry to record Labausa's and Balhag's investment in the partnership.Partnerships: Basic Considerations and Formation | 12-29 NAME: SCORE: SECTION: PROFESSOR: Problem #2 Formation of a Partnership Gogola and Paglinawan have just formed a partnership. Gogola contributed cash of P1,260,000 and computer equipment that cost P540,000. The fair value of the computer is P360,000. Gogola has notes payable on the computer of P120,000 to be assumed by the partnership. Gogola is to have 60% capital interest in the partnership. Paglinawan contributed only P900,000. The partners agreed to share profit and loss equally. Gogola should make an additional investment or (withdrawal) of12-32 | Basic Financial Accounting and Reporting by Prof. WIN Ballada SCORE: Partnerships: Basic Considerations and Formation | 12-33 NAME: PROFESSOR: SECTION: The name of the partnership will be Medina and Dalangin Hunting Gears. The partners have agreed to effect the following adjustments : Problem #5 Medina's merchandise inventory is to be reduced by P105,200. The inventory of Two Sole Proprietors Form a Partnership Dalangin will be increased by P7,200. b. The following are the fair market values of the various assets: Medina and Dalangin are fierce competitors who sell hunting equipment. They finally decided to join forces in order to increase their business and reduce costs. An Medina Land Dalangin agreement is reached between the two to begin operations as a partnership on Mar. 1, Building P108,000 2019. Office Equipment 192,000 Repair Equipment 16,000 P40,000 Medina and Dalangin have decided to share profits or losses in the ratio of 60:40, 124,000 respectively. C. One-half of the notes payable of Medina are personal notes. All other liabilities of the partners are assumed by the partnership The statements of financial position of Medina and Dalangin as at Mar. 1, 2019 are as follows: d. The prepaid rent in the books of Dalangin will be consumed by the partnership. Medina Dalangin Required: Cash 42,000 P 30,000 Prepare the journal entries to record the formation of the partnership. Accounts Receivable 389,200 169,200 Allowance for Uncollectible Accounts (22,400) (14,400) Merchandise Inventory 461,600 300,800 Prepaid Rent 6,00 Office Supplies 30,400 4,000 Land 40,000 Building 128,000 Accumulated Depreciation (32,000) Office Equipment 24,000 62,000 Accumulated Depreciation (6,000) (13,200) Repair Equipment 172,000 Accumulated Depreciation (68,000) Total Assets P1,158,800 P544,400 Notes Payable P 120,000 Accounts Payable 170,000 P111,600 Mortgage Payable 200,000 Medina, Capital 668,800 Dalangin, Capital 432,800 Total Liabilities and Owners' Equity P1, 158,800 P544,400