Advanced Financial Accounting
12th Edition
ISBN: 9781259916977
Author: Christensen, Theodore E., COTTRELL, David M., Budd, Cassy
Publisher: Mcgraw-hill Education,
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Chapter 15, Problem 15.1.2E
To determine
Concept Introduction:
Initial Investment in
When a partnership is formed, all partners can contribute for their capital. Contribution can be in cash or can be in form of fixed assets. When a partner contributes fixed assets as capital, then its capital contribution is fair value of assets contributed.
:
How the S’s capital account should be recorded.
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Required information Skip to question [The following information applies to the questions displayed
below.] Ramer and Knox began a partnership by investing $58,000 and $87,000, respectively. During its
first year, the partnership earned $180,000. Prepare calculations showing how the $180,000 income is
allocated under each separate plan for sharing income and loss. 2. The partners agreed to share income
and loss in proportion to their initial investments. Net income is $180,000. Note: Do not round
intermediate calculations.
Required information
[The following information applies to the questions displayed below.]
Ramer and Knox began a partnership by investing $60,000 and $90,000, respectively. During its first year, the partnership
earned $160,000. Prepare calculations showing how the $160,000 income is allocated under each separate plan for
sharing income and loss.
2. The partners agreed to share income and loss in proportion to their initial investments. Net income is $160,000.
Note: Do not round intermediate calculations.
Fraction to Allocate
Ramer
Ramer's Share Fraction to Allocate Knox's Share of Total Income
of Income
Knox
Income
Allocated
$125,000 / $50,000
$125,000/ $75,000
$50,000/ $125,000
$50,000/ $75,000
$
0
Problem: Admission by Purchase of Interest or Investment of Assets
Dolores Aguilar, Isolde Sustrina, and Beth Bigalbal are partners in Cavite Realty Company. Their capital balances as at July 31, 2019, are as follows:
Aguilar, Capital - 450,000Sustrina, Capital- 150,000Bigalbal, Capital- 300,000
Each partner has agreed to admit Nelia Pascual to the partnership.
Required:
Prepare the entries to record Pascual’s admission to or Aguilar’s withdrawal from the partnership under each of the following conditions:
Pascual paid Aguilar P125,000 for 20% of Aguilar’s interest in the partnership.
Pascual invested P200,000 cash in the partnership and received an interest equal to her investment.
Pascual invested P300,000 cash in the partnership for a 20% interest in the business. A bonus is to be recorded for the original partners on the basis of their capital balances.
Pascual invested P300,000 cash in the partnership for a 40% interest in the business. The original partners gave Pascual a…
Chapter 15 Solutions
Advanced Financial Accounting
Ch. 15 - Prob. 15.1QCh. 15 - Prob. 15.2QCh. 15 - Prob. 15.3QCh. 15 - Prob. 15.4QCh. 15 - Under what circumstances would a partner’s capital...Ch. 15 - Prob. 15.6QCh. 15 - Prob. 15.7QCh. 15 - Prob. 15.8QCh. 15 - Prob. 15.9QCh. 15 - Prob. 15.10Q
Ch. 15 - Prob. 15.11QCh. 15 - Prob. 15.12QCh. 15 - Prob. 15.13QCh. 15 - Prob. 15.14QCh. 15 - Prob. 15.15AQCh. 15 - Prob. 15.16BQCh. 15 - Prob. 15.1CCh. 15 - Prob. 15.2CCh. 15 - Prob. 15.3CCh. 15 - Prob. 15.1.1ECh. 15 - Prob. 15.1.2ECh. 15 - Prob. 15.1.3ECh. 15 - Prob. 15.1.4ECh. 15 - Multiple-Choice on Initial Investment [AICPA...Ch. 15 - Prob. 15.2ECh. 15 - Prob. 15.3ECh. 15 - Prob. 15.4ECh. 15 - Prob. 15.5ECh. 15 - Prob. 15.6ECh. 15 - Prob. 15.7ECh. 15 - Prob. 15.8.1ECh. 15 - Prob. 15.8.2ECh. 15 - Prob. 15.8.3ECh. 15 - Prob. 15.8.4ECh. 15 - Prob. 15.8.5ECh. 15 - Prob. 15.8.6ECh. 15 - Prob. 15.8.7ECh. 15 - Prob. 15.8.8ECh. 15 - Prob. 15.9ECh. 15 - Retirement of a Partner On January 1, 20X1, Eddy...Ch. 15 - Prob. 15.11PCh. 15 - Prob. 15.12PCh. 15 - Prob. 15.13PCh. 15 - Prob. 15.14PCh. 15 - Withdrawal of a Partner under Various Alternatives...Ch. 15 - Prob. 15.16.1PCh. 15 - Prob. 15.16.2PCh. 15 - Prob. 15.16.3PCh. 15 - Prob. 15.16.4PCh. 15 - Prob. 15.16.5PCh. 15 - Prob. 15.16.6PCh. 15 - Prob. 15.16.7PCh. 15 - Prob. 15.16.8PCh. 15 - Prob. 15.16.9PCh. 15 - Prob. 15.17PCh. 15 - Prob. 15.18PCh. 15 - Initial investments and Tax Bases [AICPA Adapted]...
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