1.

Assets contributed by P 370,000

Less mortgage assumed by partnership 80,000
Capital balance of P 290,000

2. Es initial investment:
Net assets (or capital balance), per financial position 59,625
Less: provision for doubtful accounts (18,500x3%) 555
Es share in the partnerships equity 59,070

Hs initial investment:
Net assets (or capital balance), per financial position 33,500
Less: provision for doubtful accounts (13,500x3%) 405
Under depreciation of F&F 900 1,305
Hs share in the partnerships equity 32,195

3. . J P
Capital balance before adjustments 641,976 728,352
Adjustments:
Uncollectible accounts (20,000) (35,000)
Inventories written off (5,500) (6,700)
Other assets written off (2,000) (3,600)
Capital balance after adjustment 614, 476 683,052

4. Contributed capital:
P (50,000 + 30,000) 80,000
R (70,000+110,000+100,000-50000) 230,00
Total 310,000

Total agreed capital:

Bonus method 310,000
Goodwill method (310,000+150,000) 460,000

5. Total contributed capital:

A (168,500-90.000) 78,000
B 48,600
C 32,500
Total 159,600
Divided by 3
Agreed capital of each partner 53,200

Capital adjustment:
A (78,500 53,200) (23,300)
B (53,200 48,600) 4,600
 C (53,200 32,500) 20,700

Therefore, B and C should pay A 4,600 and 20,700 respectively outside the partnership.

6. . J K
Allowance for doubtful accounts (370) (270)
F&F 1,000
Office equipment (250)
Accrued expenses (1,000) (800)
Inventories (500) 1,500
Net adjustments (870) 180

7. . A B C
Capital before goodwill 250,000 150,000 100,000
Goodwill recorded (60,000)
P/L ratio 5:3:2 30,000 18,000 12,000
Capital after goodwill 280,000 168,000 112,000
Less: 25% purchased by D 70,000 42,000 28,000
Capital after admission 210,000 126,000 84,000

8. Total agreed capital 375,000

Total contributed capital of the old partners 300,000
Jos contribution 75,000

9. Total agreed capital (200,000+100,000+150,000) 450,000

Agreed capital of K (450,000x50%) 225,000

Contributed capital of K 150,000
Bonus from P and M 3:1 to K 75,000

10. . A B C D
Capital balances before admission 700,000 500,000 400,000
Admission of D
By purchase (350,000) 350,000
By investment 400,000
Capital balances 350,000 500,000 400,000 750,000
Goodwill to old partners, 3:3:2 550,000 206,250 206,250 137,500
Goodwill to new partner 200,000 200,000
Capital balances after admission 556,250 706,250 537,500 950,000
 Goodwill computation:
Total agreed capital of the new partnership 2,400,000
Total contributed capital (350,000+500,000+400,000+750,0000) 1,650,000
Goodwill 750,000
To new partner [(2,400,000x1/4)-400,000] 200,000
To old partners 550,000

11. . Apple Banana Grapes

To Apple (1,000,000x10%) 100,000
(1,500,000x20%) 300,000
To Banana and Grapes (2,500,000-400,000-
1,500,000=600,000x5%) 30,000 30,000
Balance, equally 680,000 680,000 680,000
Total 1,080,000 710,000 710,000

12. . Ant Bee Cat Dog

Salaries 5,000 3,000
Interest 2,500 1,250 1,250 1,000
Additional profit to give to Ant
a total of 12,500 (5,000/30%) 5,000 5,000 3,333 3,333
Additional profit to meet the
minimum requirement to Dog 1,667
Amount to be earned (32,333) 12,500 9,250 4,583 6,000

13. Ps capital before retirement 100,000

Undervaluation of inventory (20,000x50%) 10,000
Profit share (140,000x50%) 70,000
Ps interest 180,000
Settlement 195,000
Goodwill 15,000