Question
On January 31, 20x4, partners of Lon, Mac & Nan Partnership, had the following loan and capital account balances (after closing entries for January): Loan
On January 31, 20x4, partners of Lon, Mac & Nan Partnership, had the following loan and capital account balances (after closing entries for January):
Loan receivable from Lon . P20, 000 Dr
Loan payable to Nan 60, 000 Cr
Lon, capital .. 30,000 Dr
Mac, capital . 120,000 Cr
Nan, capital . 70,000 Cr
The partnerships income sharing ratio was Lon, 50, Mac, 20%. And Nan, 30%. On January 31, 20x4, Ole was admitted to the partnership for a 20% interest in total capital of the partnership in exchange for an investment of P40,000 cash. Prior to Oles admission, the existing partners agreed to increase the carrying amount of the partnerships inventories to current fair value, a P60,000 increase. The capital account to be credited to Ole:
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