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The balance sheet of South Company on November 30, 2019 before accepting East as his partner to form SouthEast Partnership is presented below: South Balance
The balance sheet of South Company on November 30, 2019 before accepting East as his partner to form SouthEast Partnership is presented below: South Balance Sheet As of November 30, 2019 Assets Cash P120,000 Accounts receivable P48,000 Less: Allowance for doubtful accounts 3,000 45,000 Notes receivable 60,000 Merchandise inventory 27,000 Equipment P72,000 Less: Accumulated depreciation 6,000 66,000 Total assets P318,000 Liabilities and Capital Accounts payable P12,000 Notes payable 60,000 H, capital 246,000 Total liabilities and capital P318,000 It is agreed that for purposes of establishing Souths interest the following adjustments shall be made: 1. The accounts receivable is estimated to be 90% realizable. 2. Interest at 8% on notes receivable dated March 1, 2019 is to be accrued. 3. The merchandise inventory is to be valued at P21,000. 4. The equipment is under-depreciated by P4,800. 5. Prepaid expenses of P2,400 and accrued expenses of P7,200 are to be recognized. East is to invest cash equal to a one-third interest in the partnership. What is the amount presented under the Cash account upon formation of the partnership? What is the amount presented for Souths capital upon formation of the partnership? What is the amount presented for Easts capital upon formation of the partnership? Under an independent assumption, if it was agreed that the partners are to have equal capital interests using the bonus method regardless of the partners investments, what is the amount of bonus given to East?
The balance sheet of South Company on November 30, 2019 before accepting East as his partner to form SouthEast Partnership is presented below:
South
Balance Sheet
As of November 30, 2019
Assets
Cash P120,000
Accounts receivable P48,000
Less: Allowance for doubtful accounts 3,000 45,000
Notes receivable 60,000
Merchandise inventory 27,000
Equipment P72,000
Less: Accumulated depreciation 6,000 66,000
Total assets P318,000
Liabilities and Capital
Accounts payable P12,000
Notes payable 60,000
H, capital 246,000
Total liabilities and capital P318,000
It is agreed that for purposes of establishing Souths interest the following adjustments shall be made:
1. The accounts receivable is estimated to be 90% realizable.
2. Interest at 8% on notes receivable dated March 1, 2019 is to be accrued.
3. The merchandise inventory is to be valued at P21,000.
4. The equipment is under-depreciated by P4,800.
5. Prepaid expenses of P2,400 and accrued expenses of P7,200 are to be recognized.
East is to invest cash equal to a one-third interest in the partnership.
What is the amount presented under the Cash account upon formation of the partnership?
What is the amount presented for Souths capital upon formation of the partnership?
What is the amount presented for Easts capital upon formation of the partnership?
Under an independent assumption, if it was agreed that the partners are to have equal capital interests using the bonus method regardless of the partners investments, what is the amount of bonus given to East?
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