On January 1,204, Alps. Trading owned by Alpha and BT Enterprise owned by Beta agreed to combine their businesses and form a partnership, AB Partnership. The partnership will use a new book. Just before the partnership formation, the financial position of Alpha and Beta's businesses are as follows: Both agreed for the adjustment of the following asset values: 1. Alps Trading - 20% of the total accounts receivable are proven to be doubtful; - The fair value of inventory is P58,500; - Prepaid assets at year-end is measured at P5,800 - Furniture and fixtures is under-depreciated by P16,500; and - There was an unpaid salaries expense amounting to P13,700 at year-end. 2. BT Enterprise - Additional P12,500 of the accounts receivable are proven to be doubtful; - The fair value of inventory is P68,900; - There was unused supplies recognized amounted to P8,600; - The fair value of the land is P163,000; and - An unpaid interest on the note must be accrued amounting to P12,000. Requirement 1: Prepare the balance sheet of AB Partnership after the formation of Alps Trading and BT Enterprise. Part lla: After successfully setting up the AB partnership, Alpha and Beta agreed on the following profit and loss allocation: a. A 10% interest on their beginning capital is to be provided; b. Salary allowance of P40,000 and P70,000 to Alpha and Beta, respectively; c. 20% Bonus to Alpha for being the managing partner; and d. Any remainder must be allocated to Alpha and Beta equally. During 20x4, Alpha provide additional investment of P86,700 and made a withdrawal of P50,495. On the other hand, Beta made a withdrawal of P37,905. The partnership started its operation in 204 and had a net income of P750,000. Requirement 2: Prepare a schedule showing the allocation of 204 net income to Alpha and Beta Requirement 3: Prepare the partners' capital account for Alpha and Beta at December 31, 20x4 Part Ilb: Starting January 1,205, Alpha and Beta decided to revise their profit allocation as follows: a. A 5% interest on their average capital is to be provided; b. Salary allowance of P50,000 and P50,000 to Alpha and Beta, respectively; c. 20% Bonus on net income after bonus to Alpha for being the managing partner; and d. Any remainder must be allocated to Alpha and Beta equally. During 205, the following activities in relation to partners' capital accounts occurred: During 20x5, the partnership incurred a net loss of P600,000. Requirement 4: Prepare a schedule showing the allocation of 205 net income to Alpha and Beta Requirement 5: Prepare the partners' capital account for Alpha and Beta at December 31, 20x5 Part III: On January 1,206, Charlie, a friend of Beta was invited to join the partnership. Charlie purchased 30% interest of the partnership by paying P223,000 and total agreed capital after admission amounted to P900,000. During 206, the profit and loss allocation would be: a. A 10% interest on their adjusted beginning capital is to be provided; b. Salary allowance of P30,000 each to Alpha and Beta, respectively; c. Any remainder must be allocated to Alpha, Beta and Charlie at 35%,35% and 30%, respectively; and d. Guaranteed P90,000 income sharing to Charlie. During 20x6, no additional investment and withdrawal were made. The partnership generated a net income of P300,000. Requirement 6: How much is the individual capital of Alpha, Beta and Charlie right after Charlie's admission? Requirement 7: Prepare a schedule showing the allocation of 20x5 net income to Alpha , Beta and Charlie. Part IV: Beta decided to retire and withdraw from the partnership on January 1, 20x7. The partnership paid Beta P252,000 Included in the noncash assets is an inventory costing P20,000 with a fair value of P35,000. The remaining partners continue to use their old profit and loss ratio. The excess is considered as a revaluation (goodwill) to be recognized. Requirement 8: How much is the individual capital of Alpha and Charlie after the withdrawal of Beta? Part V: On August 31,207, the partnership decided to liquidate and filed a voluntary bankruptcy petition. The following information were available right before the liquidation: The results of liquidation are summarized below: Requirement 9: Prepare the statement of realization and liquidation of AC Partnership from August 31 to November 30, 207. Requirement 10: Prepare the schedule of safe payments for AC Partnership