I.Pine and Blun formed a partnership on January 2,2020, and agreed to share income 90% and 10% respectively. Pine contributed capital of 150,000. Blun contributed capital but has a specialized expertise and manages the firm full-time. There were no withdrawals during the year. The partnership agreement provides the following:

a.Capital accounts are to be credited annually with interest at 5% of beginning capital.

b.Blun is to be paid a salary of 3,000 a month.

c.Blun is to receive a bonus of 20% of income calculated before deducting his bonus, his salary, and interest on both capital accounts.

d.Bonus, interest and Blun's salary are to be considered as expenses

The partnership's 2020 Statement of Comprehensive Income shows the following:

Revenues650,700

Less Expenses (including salary, interest, and bonus) 235,450

Net Profit415,250

Requirement:

1.What is the amount of Blun's Bonus?

2.How is the partnership distributed between Pine and Blun?

II.Lavarro and Haredes formed a partnership on January 2, 2020 and agreed to share income 90% and 10% respectively. Lavarro contributed capital of 50,000. Haredes contributed no capital but has specialized expertise and manages the firm full-time. There were no withdrawals during the year. The partnership agreement provides for the following:

a.Capital accounts are to be credited annually with interest at 5% of beginning capital.

b.Haredes is to receive a bonus of 20% of income calculated before deducting his bonus, his salary, and interest on both capital accounts.

c.Bonus, interest, and Haredes' salary are to be considered partnership expenses.

The partnership's 2020 income statement shows the following:

Revenues192,900

Expenses (including salary, interest and bonus 99,400

Profit93,500

Requirements:

1.What is the amount of bonus to Haredes?

2.How much does each of the partners receive from the partnership net profit?

3.Explain your answer in number 2 in two to three sentences using the concepts in accounting for partnership operation.

III.Ramayo, Wandon, and Fidel, a partnership formed in January 1, 2020 had the following initial investments:

Ramayo - 100,000

Wandon - 150,000

Fidel - 225,000

The partnership agreement started that profits and losses are to be shared equally by the partners after consideration is made for the following:

Salaries allowed to partner: P60,000 for Ramayo; P48,000 for Wandon and P36,000 for Fidel.

Average partner's capital balances during the year shall be allowed 10%

Additional Informaion:

On June 30,2020, Ramayo invested an additional P60,000.

Fidel withdrew P70,000 from the partnership on September 30,2020.

Share on the remaining profit was 3,000 for each partner.

Requirements:

1.The interest on average capital balances of the partners totaled to?

2.The partnership net profit for 2020 before salaries, interest and partners' share on the remainder is?

3.Explain your answer in number 2 in two to three sentences using the concepts in accounting for partnership operation.

IV.Pito and Pico share profits after the provision of annual salary allowances of P14,400 and P13,200, respectively in the ratio of 3:2. However, if partnership's net income is insufficient to provide for said allowances in full amount, the net income shall be divided equally between the partners. In 2020, the following errors were discovered: Depreciation for 2020 is understated by P2,100, and the inventory on December 31, 2020 is overstated by P11,400. The partnership net income 2020 was reported to be P19,500.

Requirements:

1.The capital accounts of the partners should be increased (decreased) by how much?

2.Explain your answer in number 1 in two to three sentences using the concepts in accounting for partnership operation.

V.The partners of JR and JC, share profits 3:2. However, JR is to receive a yearly bonus of 20% of the net profits after deducting said bonus, in addition to his profit share. The partnership made a net income for the year of 24,000 before the bonus.

Requirements:

1.How much profit share will JR receive?

2.Explain your answer in number 1 in two to three sentences using the concepts in accounting for partnership operation.

VI. 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.

VII. 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.

VIII. 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.