On April 30,2021, the firm W. Juan, X. Kalibo and Y. Luna presents the following data from its balance sheet: Cash P21,000 Accounts payable P15,000 Other current assets 42,000 Mortgage payable 30,000 Fixed assets 702,000 Juan, capital 360,000 Kalibo, capital 225,000 Luna, capital 135,000 total P765,000 total P765,000 At this time, Z. Magsanoc is admitted to the firm when he purchases a one-sixth interest in the firm for P82,500. The old partners equalize their capital investments. Afterwards, all the partners agree to divide profits and losses equally. The new firm closes its books on June 30, 2021 reporting profit of P12,600 for the two months. The partners made the following withdrawals: Juan and Luna , P750 per month; Kalibo and Magsanoc, P1,000 per month. On June 30,2021, Magsanoc invests enough cash to increase his capital to a one-fourth interest in the partnership.

1. On June 30, 2021, the capital balances of Juan, Kalibo, and Luna before the investment of Magsanoc are a. Juan, P121,250; Kalibo, P201,650; Luna, P200,000 b. Juan, P201,650; Kalibo, P201,150; Luna, P201,650 c. Juan, P200,000; Kalibo, P200,000; Luna, P200,000 d. Juan, P360,000; Kalibo, P225,000; Luna, P135,000 2. The cash to be invested by Magsanoc on June 30, 2021 (rounded to the nearest peso) is: a. P80,333 c. P60,333 b. P20,000 d. P121,150 S. Galang and T. Hizon are partners who have capitals of P600,000 and P480,000 sharing profits in the ratio of 3:2. V. Isleta is admitted as a partner upon investing P500,000 for a 25% intrerest in the firm, profits to be shared equally. 3. Given the choice between goodwill and bonus methods, Isleta will a. prefer bonus method due to Isletas gain of P35,000 b. prefer bonus method due to Isletas gain of P140,000 c. prefer goodwill method due to Isletas gain of P140,000 d. be indifferent because the goodwill and bonus methods are the same The partnership of A. Rizal, B. Bonifacio and C. Mabini have capital account balances as follows: Rizal, P35,000; Bonifacio, P50,000; Mabini, P40,000. Their profit and loss ratios are 30%, 50%, and 20% respectively. With the consent and knowledge of Rizal and Bonifacio, Mabini sold his full interest to D. Roxas, Mabini was paid P46,000 in cash. 4. The new capital balances would be: Rizal Bonifacio Roxas a. P35,000 P50,000 P46,000 b.P36,800 P53,000 P41,200 c.P35,000 P50,000 P40,000 d.P35,000 P50,000 P 6,000 When O. Martinez retired from the partnership of Martinez, Lopez and Hilario, the final settlement of Martinezs interest exceeded his capital balance. 5. Under the bonus method, the excess a. was recorded as goodwill b. was recorded as an expense c. reduced the capital balances of Lopez and Hilario d. had no effect on the capital balances of Lopez and Hilario