I. On April 1, 2020, Ina and Jane formed a partnership with each contributing the following assets:

IJ

Cash300,000700,000

Machinery and Equipment250,000750,000

Building-2,250,000

Furniture and Fixture100,000-

The building is subject to mortgage loan of 800,000, which is to be assumed by the partnership agreement provides that I and J share profits and losses 30% and 70%, respectively.

Requirements:

1.On April 1, 2020 the balance in J's capital account should be?

2.The same information, except that the mortgage loan is not assumed by the partnership. On April 1, 2013 the balance in J's capital account should be?

II. Mar admits Jan as a partner in the business. Balance sheet accounts of Mar just before the admission of Jan show: Cash 26,000, Accounts Receivable 120,000, Merchandise inventory 180,000 and Accounts Payable 62,000. It was agreed that for purposes of establishing Mar's interest, the following adjustments be made: 1. An allowance for doubtful accounts of 3% of accounts receivable is to be established, 2. Merchandise inventory is to be adjusted upward by 25,000, and 3. Prepaid expenses of 3,6000 and accrued liabilities of 4,000 are to be recognized. If Jan is to invest sufficient cash to obtain 2/5 interest in the partnership, how much would Jan contribute to the new partnership?

III. On April 30, 2020, Ale, Ben, and Ces formed a partnership by combining their separate business proprietorship. Ale contributed cash of 500,000. Ben contributed property with a 360,000 carrying value, a 400,000 original costs and 800,000 fair values. The partnership accepted responsibility for the 350,000 mortgage attached to the property. Ces contributed equipment with a carrying amount, a 750,000 original cost and 550,000 fair value. The partnership agreement specifies that profits and losses are to be divided equally but silent regarding capital contributions. What are the capital balances of the partners at April 30, 2020?

IV. Be and Mi formed a partnership with the following agreement.

Be shall contribute non-cash assets with carrying amount of 60,000 and a fair value of 100,000

Mi shall contribute cash of 200,000

Be and Mi shall have interest of 80% and 20%, respectively on both the initial partnership capital and in subsequent profits and losses

No outside cash settlements shall be made between partners

Requirements:

1.The total partnership capital after the formation is?

2.The capital balance of Mi after the formation is?

3.The entry to record the contribution of Mi is?

V. On September 1, 2020, Alban and Armand formed a partnership and agreed to share profits and losses in the ratio 3:7, respectively. Alban contributed a parcel of land that cost him 2,000,000. Armand contributed 3,000,000 cash. The land has a quoted price of 3,600,000 on September 1, 2020.

Requirements:

1.How much should be the capital of each of the partners?

2.Explain your answer in three to five sentences by identifying the accounting for partnership formation concept behind your answer.

VI. Bell and Mill formed a partnership on June 1 and contributed the following:

BellMill

Cash450,000150,000

Land-450,000

The land was subjected to mortgage of 75,000 which was assumed by the partnership. Under the partnership contract, Bell and Mill will share profit and loss in the ratio of one-third and two thirds, respectively.

Requirements:

1.How much should be the capital of each of the partners?

2.Explain your answer in three to five sentences by identifying the accounting for partnership formation concept behind your answer.

VII. On May 1, 2020, Cru and Ferre formed a partnership with each contributing the following assets:

CruFerre

Cash30,00070,000

Machinery and Equipment 25,00075,000

Building- 225,000

Furniture and Fixture10,000-

The building is subject to a mortgage of 90,000 which is to be assumed by the partnership. The partnership agreement provides that Cru and Ferre share profits and losses 30% and 70% respectively.

Assuming that the partners agreed to bring their respective capital in proportion to their respective profit and loss ratio using Ferre's capital as the base.

Requirements:

1.How much should be the capital of each of the partners?

2.Explain your answer in three to five sentences by identifying the accounting for partnership formation concept behind your answer.