I.Xen, Xy, Xan are partners with capital balances of 80,000, 100,000, and 120,000, respectively. They share profits and losses in the ratio of 20:40:40, respectively. After one year, the operation resulted in a net profit of 40,000. Withdrawals made during the year are as follows: Xen - 20,000, Xy - 10,000, and Xan - 10,000. Xan retired from the partnership and was paid 160,000 for his interest. Assuming no asset revaluation was recorded.

Requirement:

1.The excess payment is a bonus how mu8ch and to whom the bonus was given? Explain how you arrived with the answer using the concepts in accounting for partnership dissolution.

II.Aga and Jai are partners having capital balances of 150,000 and 180,000 respectively, and sharing profits and losses equally. They admit Chong to a one-third interest in partnership capital and profits for an investment of 195,000. The asset revaluation method is used in recording the admission of Chong to the partnership.

Requirements:

1.What is the capital balance of the three partners after Chong's admission? Explain how you arrived with the answer using the concepts in accounting for partnership dissolution.

III.The business assets of J and P appear below:

JP

Cash11,00022,354

Accounts Receivables234,536567,890

Inventories120,035260,102

Land603,000-

Building-428,267

Furnitures and Fixtures50,34534,789

Other assets2,0003,600

Total1,020,9161,317,002

Accounts Payable178,940243,650

Notes Payable200,000345,000

J, Capital641,976

P, Capital728,352

Total1,020,9161,317,002

J and P agreed to form a partnership by contributing their respective assets and equities subject to the following adjustments:

1.Accounts Receivable of 20,000 in J's books and 35,000 in P's books are uncollectible

2.Inventories of 5,500 and 6,700 are worthless in J's and P's books

3.Other assets of 2,000 and 3,000 in J's and P's books are to be written off.

Requirements:

1.The capital account of the partners after the adjustments will be?

2.How much total assets does the partnership have after formation?

3.K offered to join for 20% interest in the firm. How much cash should he contribute?

4.After K's admission, the profit and loss sharing ratio was agreed to be 40:40:20 based on capital. How much should the cash settlement be between J and P?

5.How much will be the capital balances of each of the partners after K's admission?