Page | 1

NAME: Dat
e:

ACCOUNTING FOR SPECIAL TRANSACTIONS

FIRST GRADING EXAMINATION

1. AAA andBBBar epar t

ner
swi thc apit
alofP60,000andP20, 00
0,respe
c t
ive
ly.Profitsandl os
ses
aredividedint her ati
oof60:40.AAA andBBBde cidedtoform anew partnershi
pwi t
hCCC,
whoi nvest
edlandval uedatP15,000fora20% capitalint
ere
stinthenew partner
ship.CCC’scos
t
ofthelandwasP12, 000thepartnershipelec
tedtous ethebonusme t
hodt orecor
dt headmiss
ion
ofCCCi ntother e
lationshi
p.CCC’ scapi
talacc
ounts houldbecredi
tedfor
a. P12,000c.P16,000
b. P15,000d.P19,000
60+20+15=95x2 0%=1 9

2. AAA and BBB f ormed par t

ner shi
pi n2009.Thepa r
tner
shipa greementprovidesforannual
sal
aryallowancesofP55,000f orAAA andP45, 000forBBB.Thepa rt
nersshareprofit sequal
ly
andlosse
si na60:40r
ati
o.Thepar t
nershi
phade arni
ngsofP80,000for2009befor
eanyal l
owance
topart
ner s
.Wha tamountoft he s
ee ar
ningss houldbecredi
tedtoe ac
hpar tne
r’scapi
talac
count?
AAA BBB AAA BBB
a. P40,
000P40,000c.
P 44,000 P 36,000
b. 43,
000 37,000 d. 45,000 35,000
B

3. Thepar tnershipa greementofAAA and BBB pr ovidesthatinter

esta
t10% perye aristobe
creditedtoe achpar tneront hebas
isofwe
ighte
d- averagecapit
albal
anc
es.A s
ummar yofBBB’
s
capitalaccountf ortheyearendedDecember31,2009,isasfoll
ows:
Balance,January1 P 140,
000
Addi ti
onalinve s
tme nt
,July1 40,
000
Wi t
hdr awal,Augus t1 15,
000

Wha tamountofinter
ests
houl
dbec
redi
tedt
oBBB’
scapi
talac
countf
or20
09?
a. P15,
250c.P16,
500
b. P15,
375d.P17,250

4. AAA andBBBarepartner
swhos har
eprofitsandlos
sesont
her
ati
oof6:
4,r
espe
cti
vel
y.OnMa y
1,
2009,t
hei
rre
spect
ivecapit
alac
countswe
reasfol
lows
:
AAA P 60,
000
BBB 50,
000

Ont hedat
e,CCCwasadmi t
tedasapar t
ne rwi t
hone -
thi
rdint
eres
tincapi
talandprofitsforan
investmentofP40,
000.Thenew part
nershipbe ganwithtot
alcapit
alofP150,
000.I
mme di
atel
y
afterCCC’sadmiss
ion,AAA’
scapit
alshouldbe
a. P50,000 c.P56,
66 7
b. P54,000 d.P60,000
 Page | 2

5. AA and BB f
ormed apart
ner
shi
pin 20x1and madet
hef
oll
owi
ngi
nves
tme
ntsand c
api
tal
wi
thdra
walsduringt
heyear
:

AA BB I
nve
stments Dr a
ws I
nve
stments Dr
aws
March1………………P30,000 P20,000
J
une1………………………… P10,000 P10,
000
August1………………20,
000 2,
000
December1……………………. 5,000

Thepartners
hip’
sprofitandl os
sagreementpr
ovidesf
orsalar
yofwhi chP30,00
0waspaidtoe
ach
par
tnerfor20x1.AAistor ecei
veabonusof10% onneti
ncomeaf t
ersal
ariesandbonus
.The
par
tnersareals
otorecei
vei nte
res
tof8% onaver
ageannualcapi
talbal
ancesaffec t
edbybot
h
i
nvest
me ntsanddrawings.Anyr emai
ningprofitsaret
obeal l
ocat
edequal l
yamongthepar
tne
rs.

Assumingthene tincomeofP60,
000be
for
esal
ari
esandbonus,determinehow theinc
omewoul
dbe
all
oca
tedamongt hepa r
tners
.
a.AA,P31,138;BB,P28, 862 c.AA,P30,633;BB,P29,376
b.AA,P33,537;BB, P26,463 d.AA,P30,684;BB,P29,316
D

Usethefoll
owi ngi nforma
tiontoans we rt
hene xttwoques tions
Thefol
lowingc ondens e
dbalancesheetispres
entedfort hepar tnershipofAAAandBBB,whoshar
e
profitsandl ossesinther
atioof60:40,res
pecti
vely:
Cash P 45,
000 Ac count spayable P 120,
000
Otheras s
e t
s 625,
000 AAA,c api t
al 348,
000
BBB,loan 30,
000 BBB, capi t
al 232,
000
Tot
al P 700,
000 Total P 700,
000

Theas
setsandliabi
li
ti
esar
efai
rl
yvalue
dont
hebal
anc
eshee
t.AAAandBBBde
cidet
oadmi
tCCC
asanew part
nerwith20%int
eres
t.

6. Whatamountshoul
dCCCc ont
ribut
einc
ashorot
heras
set
s?
a. P110,
000 c.P140,
000
b. P116,
000 d.P145,
000

D348,
000+232,
000=580÷80% x20
% =145,
000

7. Ins
teadofadmitt
inganew part
ner,AAAandBBBdecidet
oliqui
dat
ethepar
tners
hip.I
fot
her
ass
etsar
es ol
dforP500,
000,whatamountoft
hea
vai
lablec
ashshoul
dbedist
ribut
edtoAAA?
 Page | 3

a. P255,
000 c.P327,
000
b. P273,
000 d.P348,
000
B

8. Thefol
lowingconde
nsedbal
ances
heetispre
sente
dforthepar
tne
rshi
pofBBBandAAA,who
shar
eprofit sandl
oss
esonthera
tioof60:
40,r
espec
tive
ly:
Otherass
ets P 450,
000
BBBloan 20,
000
P 470,
000

Account spayable P 120,

000
BBB,c apit
al 195,
000
AAA,c api
tal 155,
000
Total P 470,
000
Thepar t
ne r
sha vede c
idedtol i
qui
dat
ethepartner
ship.I
ftheot
heras
set
sares
oldP385,00
0,wha
t
amountoft hea vai
lablecas
hs houl
dbedist
ribute
dt oBBB?
a. P136,000 c.P159,
00 0
b. P156,000 d.P195,000
A

9. OnDecember31,1998, t
hepar t
nersofMNPPar tne rshi
pdec idedtoliquidat
etheirbusi
nes
s.
I
mmediate
lybefor
el iquida
tion,t
hefoll
owingc ondens edbalancesheetwaspr epared:
Cash P50,
000 Liabili
tie s P375,000
Noncashasset
s 900, 000 Ni e
va ,loan 80,000
Pere z
,l oan 25,000
Munoz ,capit
al(50%) 312, 500
Ni eva,c apit
al(30%) 107, 500
____ Per
ez,c
api t
al( 20%) 50,
000
Tot
al P950,000 Total P950,000

Thenoncashas
setsweresol
dforP400,
000.As
sumingPerezi
stheonl
ysol
ventpart
ner,wha
t
amountofaddi
tionalc
ashwillbei
nvest
edbyPer
ez?(rounde
dt ot
henear
estpes
o)a .
P
37,
143
b. 25,
000
c. 5,
250
d. 0

B
 Page | 4

10.
Thepar tner
softheM &N Partner
shi
pstart
edli
quidat
ingthe
irbus
ines
sonJul
y1,2004
,atwhich
ti
met hepartner
swereshar
ingprofitsandlos
ses40% t
oM and60% toN.Thebal
ances
heetof
thepart
ne r
shipappe
are
dasf ol
lows:

M &N Par
tner
ship
Bal
anc
eShe
et–July1,2004

Assets Li
abi
li
ti
es&Capi
tal
Cas h……………………. P8, 800 Account
spayable
………… P32,
400
Re c
eivable……………… 22 ,
400 M,capit
al………………… P31, 000
Inventory…………. .
.….. 39,
4 00 M,drawing………… 5,
400 25,600
Equi pment…..P65,200 N,
capi
tal
………………… . P33,200
Ac cumula t
ed N,drawing……………………. 200 33,000
depreciat
ion 30,800 34,400 N,l
oan…………………………………… 14,000
Total…………………… P105,0 00 Tot
al…………………………………… P105, 000

Duri
ngthemont
hofJul
y,thepart
nerscol
lec
tedP600oft
herece
ivabl
eswi
thnol os
s.Thepar
tne
rs
al
sosol
dduri
ngthemonththeenti
reinve
ntoryonwhichthe
yreali
zedat
otalofP32,
400.

How muchofthecas
hwaspa i
dtoM’
scapi
talonJ
uly3
1,2004
?
a.P - 0- c.P5,400
b.25,600 d. 320
D

11.
Af t
eral
lnoncas
has s
etshavebeenconvert
edintocas
hinthel
iqui
dat
ionoft
heAAandJ
J
part
ner
ship,
theledgercont
ainst
hefollowingacc
ountbal
anc
es:

De
bit Cr
edi
t

Cash……………………………………………… P34, 000

Account spayabl
e………………………………………………………… P25,000
Loanpa yabletoAA……………………………………………………….
. 9,000
AA,c apital
…………………………………………… 8 ,
000
JJ
,capital……………………………………………………………… 8,
000
 Page | 5

Avai
labl
ecas
hshoul
dbedi
str
ibut
ed;
P25,
000t
oac
count
spa
yabl
eand;

a. P9,000l
oanpayabl
etoAA c.
P1,000t
oAAandP8,000t
oJJ
b. P4,500e
achtoAAandJ J d.P8
,000t
oAAandP1,000t
oJJC

12.
Af t
erinc
urr
ingl
oss
esr
esul
ti
ngfrom ve
ryunprofit abl
eoper
ati
on,t
heAl
phabe
tsPar
tne
rshi
p
deci
dedtoli
qui
dat
ewhenthepart
ners
’capi
talbal
anceswer
e:

A,capi
tal(
40%) P80,
000
B,c
apit
al(40%) 130,
000
C,c
apital(
20%) 96,
000

Thenon-cashas s
etsweresoldininstal
lme nt.
Avail
ablecashwe r
edis t
ribute
dt opa r
tnersine ver
y
sal
eofnon- cashass
ets
.Aftertheseconds aleofnon-c
ashasset
s,thepar tne
rsreceivedthes ame
amountofc ashinthedist
ributi
on.Andf rom thethir
dsaleofnon-cashas set
s,cashavailablefor
dis
tri
but
ionamount st
oP28, 000,andnon- cashass
etshasabookval ueofP12, 500.Usingc ash
pri
ori
typr ogram,whatamountdi dCr ec
e i
vedinthethirdins
tall
me ntofcash?a .P11,600
b. 8,000
c. 5,600
d. 0
C
28,
000x20% =5, 600

13.Thepar
tne
rshi
pofAA,BB,andCCwasdis
sol
vedonJune30,20x1andac
countbal
anc
esaf
ter
non-
cas
hasset
swer
econver
tedi
ntoc
ashonSe
ptember1,2004are:

Cas
h……………………………P50,
000 Ac
count
spayable P120,
000
AA,capital(30%) 90,000
BB,c
apital(30%) (60,000)
CC,capi
tal(40%) (100,000)

Pe
rsonalas
set
sandl
iabi
li
ti
esoft
hepar
tne
rsa
tSe
pte
mber1,20x1ar
e:

Pe
rso
nal Per
sona
l
Asse
ts Lia
bili
ti
es
AA………………………………………………………….
.P80,
000 P90,000
 Page | 6

BB………………………………………………………… 100,000 61,

000
CC………………………………………………………… 192,000 80,
000

I
fCCcontri
butesP70,000t
ot hepa
rtne
rshi
ptoprovi
decas
ht opayt
hec
redi
tor
s,wha
tamountof
AA’
sP90,000part
ne r
shipequit
ywouldappeart
oberec
overabl
e?

a.P90,
000 c.P79,000
b.81,
000 d.None
B

14.Par
tnersAbl
e,Bake
r,andChapman, whoshar
eprofitandlosse
quall
y,ha
vet
hef
oll
owi
ng
per
sonalas
set
s,per
sonall
iabi
li
ti
es,andpar
tner
shi
pcapi
talbal
anc
es:

Abl
e Bake
r__ Chapman_
Per
sonalas
set
s P30,
000 P80,
000 P60,
000
Per
sonalLi
abi
li
ti
es 25,
000 50,
000 72,
000
Capit
albal
anc
es 50,
000 (
32,
000) 70,
000

Afte
rapplyingthedoctri
neofmars
hal
ingofas
set
s,thecapi
talbal
anc
esofAbl
e,Bake
r,and
Chapman,r es
pect
ive
ly,wouldbe
a.P50,
000 P(
2,000) P58,000
b. 48,
000 0 58,
000
c. 49,
0 00 0 57,
000
d. 34,000 0 54,
000
C

15.
A,BandCar epartner
sinate
xtil
edi
str
ibutionbusi
nes
s,s
haringpr
ofitsandlos
sese
qua
lly
.On
De
cember31,2004,t
hepar
tners
hipc
apitalandthepar
tner
s’drawi
ngwereasf
oll
ows:

A B C Tot
alCapitalP1
00,000
P80,
000P300,
000 P480,
000
Dr
awi
ng 60,
000 40,
000 20,000 120,
000
 Page | 7

Thepar t
ne r
shipwasunabl etocol
lec
tonitstrader ecei
vabl
es,anditwasforc
edtoli
qui
dat
e.The
operat
ingpr ofitsfor2005amount edtoP72,000,andwasal lexhaust
edincl
udingt
hepar
tner
shi
p
asse
ts.Uns e
ttl
edcredit
ors
’c l
aimatDe c
embe r31, 2005amount e
dt oP84,
000.BandChave
subst
antialpri
vat
er es
ources,butAhasnoa vailablefr
eeassets
.

Thefinalcas
hdi
str
ibut
iont
oCwas
:a.
P162,
000
b.P108,
000
c.P 84,
000
d.P 78,
000

16.
A,BandCar epar t
nerswi t
hc apit
albalanceofP350, 000,P250,
000andP350, 000ands har
ing
profits30%, 20% and50% re s
pecti
vely.Part
ne r
sagr eetodis
solvet
hebus i
nes sandupon
li
quidat
ion,allofthepartnershipasset
sar esol
dands uffic ientcas
hisrealizedtopayallthe
cl
aimsex c
eptf orP50,000
.Ci spersonal
lyi ns
olvent,buttheothertwopartnersa r
eabletome et
anyindebtedne s
stothefir m.Ont her emainingc l
aima gai
nstthepart
nership,Aistoabsorb.

a.P40,
000
b.P15,
000
c.P30,
000
d.P25,
000

17.
A,B, andCar epart
ne r
sinABCPar tner
shipands har
epr
ofitsandlos
ses
,5:
3:2,
respect
ively
.The
part
ner sha
veagreedtoli
quidat
ethepartner
ship.Pri
ort
oli
qui
dati
on,t
hepar
tnershipbalance
she
ets howsthefol
lowingbookvalues.

Cash P25,200
Non-cash 297,60
0
Notes,payabl
etoC 38,
400
Otherliabi
li
ti
es 18
4,800
 Page | 8

A,capi
tal 72,00
0
B,c
apit
al (
12,000)
C,capi
tal 39,600

Li
qui
dati
onexpe
nse
sofP16,
800ar
epai
d.Non-
cas
has
set
swi
thabookval
ueofP240,
000a
res
old
f
orP216,
000.

How muchcas
hshoul
dCr
ecei
ve?a.
P74,
571
b.P46,
458
c.P39,
600
d.P37,
600

18.
Part
nersBee
,Cee,
De eandGeewhosharepr
ofits5:
3:
1:1,
res
pec
tive
ly,de
cidet
oli
qui
dat
ethe
ir
par
tne
rshi
p.Capi
talbal
anc
esbef
orel
iqui
dat
ionar
e:

Bee P60,
000
Cee 40,
000
Dee 30,
000
Gee 10,
000
Thepartner
sa greetothefol
lowi
ng:
(
1)Par
tner
s hi
p’sc omputerequi
pmentwit
habookval ueofP12,
000istobet
akenoverbypart
nerBeea
t
apri
ceofP15, 000.
(
2)Par
tner
s hi
p’sliabil
it
iesar
etobepai
doffandt hebalanceofcashonhand,P30,
000ist
obedivi
dedin
amanne rt
ha twi l
lavoidt
hene e
dforanypossi
blerec
overyofcashfr
om apart
ner.

How muchoft
heP30,
000c
ashbedi
str
ibut
edt
oPar
tnerCee
?a.
P10,
000
b.P 0
c.P20,
000
d.P15,
000

A
Page | 9
 Page | 10

19.
AandBde c
idedtol
iqui
datetheirpartne
rshi
pbusi
nessonJune1,20
05,underl
ump-sum
l
iquidat
ion.Thepar
tner
shadbee nshari
ngprofitsandloss
esona60:40r
ati
o.Thebal
anc
eshee
t
prepar
edont hedayofl
iquidat
ionbe ganwasasf
oll
ows:

Asse
ts Li
abil
it
iesandCapital
Cas h P18, 000 Accountspayabl
e P42,000
Receivable
s 75,000 A,loan 24,
000
Inventory 90,000 A,capit
al 102,
000
Other 84,000 B,capi
tal 99,
000
Total P267,000 Tot
al P267,
000

DuringJune,
one-t
hir
doftherece
ivabl
eswascoll
ect
ed;P45,
000ofi
nve
ntor
ywass
olda
tana
ver
ageof
70% ofbookval
ue;ot
herass
etsweresol
dforP36,
000.

How muc
hshoul
dAandBr
ece
iveuponl
iqui
dat
ion?

A B
a.P32,
100 P36,
400
b.P 8,
100 P27,
400
c.P40,
200 P41,
800
d.P59,
100 P54,
400

A
Carr
yingamountofnon-c
ash(75+90+84) 249
Amountreal
izedfr
om sal
e(1/3x75)+(
70% x45)+36 ( 92.
5)
Los
sonrea
li
zat
ion (156.
5)

Cas
h18+92.
5=110.
5–42=68.
5cas
havai
labl
etopar
tne
rsl
essc
api
talbal e225K=(
anc 156.
5)

20.A,B,andC,whodivi
deprofitsandlos
ses50%,
30%,
and2
0%,r
espe
cti
vel
y,ha
vet
hef
oll
owi
ng
December31,
20x1ac
countbal
anc
es:

A,dr
awi
ng(
Dr.
)………………………………………………………… P12,000
C,dr
awi
ng(
Cr.
)……………………………………………………….
.… 4,
800
 Page | 11

Accountsre
ce i
vabl
e-A……………………………………………….
… 7,200
Loanspayable-B…………………………………………………………. .
. 14,400
A,capit
al…………………………………………………………………. 59,400
B,capi
tal……………………………………………………………………. 44, 400
C,capi
tal………………………………………………………………. .… 39,000

Onthisdat
a,t
hepart
nershi
p’sas
setsar
eP211,
200(i
ncl
udingcas
hofP64,200).
Thepar
tnershi
pi s
l
iqui
datedandCrec
eivesP33,
000infinalset
tle
ment.How muchi
sthetotallos
sonreal
izat
ion?

a.
P10,
800 c.P54,
000
b.31,
200 d.64,200
C

21.AandBsharepart
ners
hipprofitsandl
oss
esi
na7:
3ra
tio.
The
irpos
t-c
los
ingt
rialbal
anc
eon
J
anuar
y31show bef
oreli
qui
dati
on:

Cash………………………………………P30, 000
Ac c
ount srec
eivabl
e,net
………….
…….
..380,000
Inventory……………………………… 260,
000
Furniture,net
…………………………… 120, 000
Ac c
ount spayable…………………………………………………P16 5,000
A,c apit
al…………………………………………………………. .
.350,000
B,capital………………………………………………………. 275, 000

Coffe r
edtobuyforP760,
000t
hepart
nershi
passet
sincl
udingl
iabi
li
ti
esbute
xcl
udi
ngc
ashandaf
ter
c
ert
ainass
etsar
etoberest
ate
datthe
irf
airval
uesasfol
lows:

Ac c
ountsr
ece
ivabl
e……………………………………………….
. P350,000
Invent
ory……………………………………………………………… 250, 000
Furnit
ure……………………………………………………………… 135, 000

How muc
hwi
llAandBr
ecei
veasfinals
ett
leme
ntoft
hei
rpar
tne
rshi
pint
ere
st?

a.P570,000 c.P790,000
b. 760,
000 d.625, 000
C

22.
AAAandBBBpar
tne
rshi
p’sbal
anc
eshe
eta
tDec
ember31,
2009,
repor
tedt
hef
oll
owi
ng:
 Page | 12

Tot
alAs se
ts P 100,
000
Tot
all
iabil
iti
es 20,
000
AAA,c apit
al 40,
000
BBB,c
api t
al 40,
000

OnJ anuary2,2010,AAA andBBB di s

solvedthei
rpar t
nershipand transferr
edallas
se t
sand
li
abil
iti
estoane wlyforme dcor
por a
tion.Att hedat
eofi ncorpora
tion,thefairval
ueoft henet
asset
swasP1 2,
000mor et han thecarrying amountint hepar tnership’
sbooks,whic h was
assi
gnedt otangibleass
ets.AAA a ndBBBwe reeachiss
ued5, 000sharesoft hecor
pora
tion’sP1
parvaluec ommon s t
ock.Immedi atel
yf oll
owing i
ncorporat
ion,addi ti
onalpaid-i
ncapi t
alin
exces
sofpars houl dbecre
di t
edfor
a. P68,000c.P77,000
b. P70,000d.P82,000

D80K+12K=92K–10K=82K

23.Whe npropert
yot herthancashisi
nves t
edi
napar t
nershi
p,atwhatamountshouldt
henonc
ash
propert
ybec redit
edtothecontri
butingpar
tne
r’scapi
talacc
ount
?a. Fai
rvalueatt
hedat
eof
contr
ibuti
on.
b. Contri
butingpartner’
sori
ginalcost.
c. As s
essedvaluati
onforpropert
yt axpur
poses.
d. Contri
butingpartner’
staxbasi
s.

24.AandBf ormedapar tner

ship.Acontr
ibutedcashof₱ 500,
000whil
eBcont
ributedl
andwith
car
ryingamountof₱ 400,
000andfai ueof₱ 800,
rval 000.Thel
andhasanunpaidmortga
geof
₱200,
000whichisassumedbyt hepart
nership.How muc hist
hecor
rec
tval
ua t
ionofB’
scapi
tal
imme di
ate
lyaf
terthepartners
hipf
orma t
ion?a.400,
000
b. 500,
000
c. 600,
000
d. 800,
000

So
lut
ion:

Par
tners
hi
A B p
Cash 500,
000 - 500,
000
Land(a
tfa
irva
lue
) 800,
000 800,
000
To
tal 500,
000 800,
000 1,
300,
000

Mor
tgagepa
yabl
e - 200,
000 200,
000
A,capi
tal 500,
000 500,
000
B,capi
tal(
800K– 600,
000
200K) 6
00,
000
To
tal 500,
000 800,
000 1,
300,
000
 Page | 13

25.Mr .AandMs .Bf ormedapar tnershipanda greedtodividet heini

ti
alc apitalequal
lyeven
thoughMr .Ac ont r
ibuted₱ 100,
000andMs .Bcontr
ibuted₱ 84,000ini dent i
fiableas set
s.The
partnersagr
eet hatthedi fferenceint heamountofc ontributi
onandt hea mountofc reditt
othe
partner’
scapitals hallbetrea
tedasc ompe nsati
onforthee xperti
sethatthepar t
nerwillbe
bringi
ngt othepar t
ne rs
hip.How muc histhecorre
ctvalua ti
onofA’ scapitalimme dia
telyaft
er
thepartners
hipf orma ti
on?a.84,000
b. 92,000
c. 100,000
d. 108,000

Sol
uti
on:
Cash 184,
000
A,Capi
tal(
184,
000÷2) 92,
000
B,Capi
tal(
184,
000÷2) 92,
000

26.AandBf
ormedapar
tne
rshi
p.Thef
oll
owi
ngar
ethei
rcont
ribut
ions
:

A B
Cas
h 500,
000 -
Acc
ountsr
ece
ivabl
e 100,
000 -
Bui
ldi
ng 700,
000
Tot
al 60
0,000 700,
000

A,c
api
tal 600,
000
B,capi
tal 700,
000
Tot
al 600,
000 700,
000

Addi
ti
ona
linf
ormat
ion:
● Theaccountsr
ec ei
vabl
eincludesa₱20 , 000ac
countt
hatisdeemeduncol
lec
tibl
e.
● Thebuildi
ngisunde r-
depreci
atedby₱50,000.
● Thebuildi
nghasanunpa i
dmor tgage₱ 100
,000,
butthi
sisnotassumedbythepartne
rshi
p.
Par
tne
rBpr
omi
sedt
opa
yfort
hemor
tgagehi
mse
lf.

How muchist
hec
orr
ectval
uat
ionofA’
scapi
tali
mme
dia
tel
yaf
tert
hepar
tne
rshi
pfor
mat
ion?a
.
460,
000
b. 580,
000
c. 650,
000
d. 720,
000

So
lut
ion:
Part
ners
hi
A B p
Cas
h 500,
000 - 500,
000
 Page | 14

Accounts
re
ceivabl
e
(
100K–20K) 80,
000 - 80,
000
Buil
ding(
700K– 650,
000
50K) 650,
000
Tota
l 580,
000 650,
000 1,
230,
000

A,c
api
tal 580,
000 580,
000
B,capi
tal 650,
000 650,
000
Tot
al 580,
000 650,
000 1,
230,
000

27.Mr .A and Ms .B forme d apartnershi

p and agr
eedtodi vi
det hei ni
tialcapit
alequal
lyeven
thoughMr .A contri
buted₱ 100,000andMs .Bcontr
ibut
ed₱ 84, 000ini denti
fiableasse
ts.The
par tnersagreethatthediffe renceintheamountofc ont
ributi
onandt heamountofc redi
ttothe
par tner’
scapitalshallbetre
atedasc ashsett
lementbetwee
nt hepar t
ner s.Thecompoundent r
y
tor ecordthepar tner
s ’c
ontri
butionsincl
udesac r
edittoB’
sc api
talac c
ounti ntheamountofa .
84,000
b. 92, 000
c. 100, 000
d. 108, 000

Sol
uti
on:
Cash 184,
000
A,Capi
tal(
184,
000÷2) 92,
000
B,Capi
tal(
184,
000÷2) 92,
000

Thecas
hs e
ttl
ementamongthepar
tnersi
snotr
ecorde
dinthepar
tner
shi
p’sbooksbecaus
ethi
sisnota
tr
ans
acti
onofthepart
ners
hipbutr
atheratr
ans
acti
onamongthepar
tner
sthemselve
s.

28.Ifthepartnershi
pa gree
me ntdoe snots pec
ifyhow incomei
stobeall
oca
ted,pr
ofitsand l
oss
shouldbeallocat
eda . Equally.
b. Inproportiontotheweightedaverageofcapi
talinve
ste
dduri
ngt
heperi
od.
c. Equit
ablys othatpar
tnersarecompe nsat
edfortheti
meandefforte
xpendedonbe
halfoft
he
part
nership.
d. Inaccordancewi t
hthei
rc api
talcontr
ibuti
ons.

29.A andBs hareinpar tnershi

pprofit sand l
oss
esona40:60r a
tio.Duringtheye ar
,A’sc apit
al
accounthasane ti ncre eof₱ 50,
as 000.Par
tnerA madecont
ributionsof₱ 10,000andc apital
withdrawalsof₱ 60,000dur i
ngt
heye ar
.How muc hwast
heshareofBi nt hepartnershi
ppr ofit
fortheyear?
a. 100,000
b. 150,000
c. 200,000
d. 180,000

So
lut
ion:
 Page | 15

St
ep1:
A,Ca
pit
al
beg. -
Wi
thdra
wal
s 60,
000 10,000 Addi
ti
onali
nves
tment
Shar
ein ? pr ofit end.
50,
000
St
ep2:
A,Ca
pita
l
beg. -
Wit
hdrawal
s 60,
000 10,
000 Additi
onalinves
tme
nt Shar
e
inprofit 100,000 (squee )e
ze nd.
50,
000
St
ep3: 100,000÷40% =25
0,000par
tne
rshi ofit
ppr
St
ep4:
B’ss e:250,
har 000x60% =150,000

30.Thepar
tners
hipagreeme ntofA,BandCs ti
pulatesthefoll
owi ng:
● Part
nersAandCs hallre
cei
veannualsalar
iesof₱12 , 000and₱8, 000,r
espect
ive
ly.
● Abonusof10% ofpr ofitaftersal
ari
esbutbe forededuc t
ionofbonusshal
lbegiventoPar
tnerA,
t
hemanagingpartner.
● Eachpartnershal
lr ec
eive10% i
nter
estonaver agecapit
alinvest
ments.
● Anyr e
mai ni
ngpr ofitorl ossshal
lbesharedasf oll
ows :40% t
oAand30% e achtoBandC.

Thea
ver
agec
api
tali
nves
tme
ntsofpartnersdur
ingt
heye
arar
easf
oll
ows
:
A ₱100,000
B 60,00
0
C 120,0
00

Thepar
tne
rshi
pear ofitof₱100,
nspr 000
.

How muchist
hes
har
eofPar
tne
rCi
nthepar
tne
rshi
ppr
ofit
?
a. 47,
600
b. 32,
200
c. 19,
200
d. 33,
200

So
lut
ion:
A B C Tot
al
Amountbe i
ngal
loc
ate
d 100,
000
Al
loc
a t
ion:
1.
Salari
e s 12,
000 8,
000 20,
000
2.Bonus(100K-20K)x10% 8,
000 8
,000
3.Int
ere
stonc ap.
(100Kx10%) ;
(60Kx10%);
(120Kx10%) 10,
000 6,
000 12,
000 28,
000
4.Al
loc
ationofremai
nder: 17,
600 13,
200 13,
200 44,
000
(100K-20K-8K-28K)=44K;
 Page | 16

(
44Kx40%);(
44Kx30%)
;(44Kx30%)
Asa
ll
oca
ted 47,
600 19,
200 3
3,200 100,
000

31.Thepart
nershi
pa gr
eeme ntofAandBpr ovidesthati
nteres
tat10% peryeari
stobecr
edite
dto
eac
hpartneronthebasisofweighted-
averagecapit
albalances
.Asummar yofB’
scapi
talac
count
f
ortheyearendedDe c
ember31 ,20x1isasfoll
ows :

Bal
anc
e,Jan.
1,20x1 252,
000
Addi
ti
onalinve
stment
,Jul
y
1 72,
000

Wit
hdrawal
,August1 (
27,000)
Bal
anc
e,Dec.31,
20x1 297,000

How muchist
hei
nte
res
tonB’
swei
ght
eda
ver
agec
api
tal
?
a. 27,
675
b. 33,
633
c. 37,
214
d. 23,
322

Sol
uti
on:
Balance,Jan.1,20x1 252,
000 12/12 252,000
Addi t
ionalinvestme nt
,Jul
y1 72,
000 6/12 36,000
Wi t
hdr awal,Augus t1 (27,
000) 5/12 (11,250)
We i
ghtedaverag
ec a
pital 276,750
Mul t
iplyby: 10%
Inter
est 27,675

32.RedandWhi teformedapar t
nershi
pin2003.Thepar t
ner
shipa gree
me ntpr ovidesforannual
sal
aryal l
owancesof₱ 55,
000forRedand ₱45,000forWhite.Thepartnerss hareprofit s
equall
yandl ossesina60/40rati
o.Thepart
nershiphadearningsof₱ 80,000f or2003before
anyallowancetopar t
ners.Whatamountoftheseearni
ngsshoul dbecreditedt oeachpartner’
s
capi
talaccount?
Red Whi t
e
a. 40,000 40,000
b. 43,000 37,000
c. 44,000 36,000
d. 45,000 35,000

So
lut
ion:
Re
d Whi
te Tot
al
Amountbei ngal
loc
ated 80,
000
All
ocat
ion:
1.Salar
ies 55,
000 45,
000 100,
000
 Page | 17

2.
Al locat
ionofremai
ningprofit
(80Kpr ofit–100Ks al
ari
es)=-
20K
(-20x60%) ;(
-20Kx40%) (
12,
000) (
8,000) (
20,
000)
Asa l
loc
ated 43,
000 37
,000 80,
000

33.Fox,Greg,andHowear epart
ne rswit
ha veragecapi
talbal ancesduri
ng200 2of₱ 120,000,₱60
000,and₱ 40,
, 000,respect
ive
ly.Part
nersr e
ceive10% interestontheiraver
agecapitalbalances
.
Afterdeduc ti
ngs alari
esof₱ 30,000toFoxand₱ 20, 000toHowe ,theresi
dualprofitorl ossi
s
divi
de dequa l
ly.In200 3thepartners
hips ust
aineda₱ 33, 000lossbefor
einter
estands al
arie
s
topartners.Bywha tamounts houldFox’scapitalac
c ountc hange?
a. 7,000increase.
b. 11,000de cr
ea se.
c. 35,000de cr
ea se.
d. 42,000increase.

So
lut
ion:
Fox Gr
eg Howe Total
Amountbeingal
loc
ate
d (
33,
000)
All
oca
tio
n:
1.
Salar
ies 30,
000 - 20,
000 50,
000
2.I
nter
estoncapi
tal 12,
000 6,
000 4,
000 2
2,000
3.All
ocat
ionofbal
ance
(
-33K–50K-22K)=- 105K/3 (
35,000) (
35,000) (
35,
000) (
105,000)
Asal
lo
cate
d 7,
000 (29,
000) (
11,
000) (
33,000)

34.Thepart
ners
hipagre
eme ntofAxel,Be
rg&Cobbprovi
desfort
heyear
-endalloc
ati
onofnet
i
ncomeinthefoll
owingorder
:
● Firs
t,Axeli
storece
ive10% ofneti
nc o₱100,
omeupt 000 and20% over₱100,
000.

● Se
cond,Be
rgandCobbe
achar
etor
ecei
ve5% oft
her
emai
ningi
nc r₱150,
omeove 000.● The
bal
anc
eofi
ncomei
stobeal
loc
atede
qual
lyamongt
het
hre
epa
rtne
rs.

Thepar
tne
rshi
p’s200
3ne
ti omewas₱ 25
nc 0,000be
for
eanyal
loc
ati
onst
opar
tne
rs.Wha
tamount
s
houl
dbeal
loc
ate
dtoAx
el?
a. 101,
000
b. 103,
000
c. 108,
000
d. 110,
000

So
lut
ion:
Axe
l Be
rg Cobb Tot
al
Amountbe
ingal
loc
ate
d 250,
000
 Page | 18

Alloc
ati
on:
1.BonustoA
Fi
rst100K(100Kx10%) 10,
000 10,
000
Over100K[(250K-100K)x20%] 30,
000 30,
000
2.BonustoBe rgandCobb
(
250K-10K-30K-150K)x5% 3,
000 3,000 6,
000
3.All
ocat
ionofbal.(
204K/3) 68,
000 68,
000 6
8,000 204,
000
Asall
oca
ted 108,
000 71,
000 7
1,000 250,
000

35.Bl
auandRubiarepart
nerswhoshareprofitsandloss
esinther
ati
oof6:
4,r
espec
tive
ly.On
May1,2003
,the
irr
espect
ivec
api
talaccount
swereasfol
lows:

Bl
au 60,
000
Rubi 50,
000

Ont hatdate,Lindwasadmi tt
edasapar t
nerwit
haone-
thi
rdinte
resti
ncapitalandpr
ofit
sforan
i
nvestme ntof₱ 40,000.Thenew part
ners
hipbe
ganwit
htotalc
apialof₱ 150,
t 000. Immedia
tel
yaft
er
Li
nd’ sadmis s
ion,Blau’sc
apit
alshouldbe
a. 50,000
b. 54,000
c. 56,667
d. 60,000

Sol
ution:
Tot
alc apit
alafteradmi ss
ion 150,
000
Inter
estofBl aubefor
ea dmi s
sionofLind 60,00
Multiplyby: I
nterestofLind 1/3
CapitalcreditD educti
o n t
o Bl
au'
s capit
al (
6,000
toLind Adjus t
edc apit
alofBlauafteradmissi
on 54,00
Bonust oLind 10,
000
Multiplyby: OldP/Lr a
tioofBlau 60%
Deduc ti
ont oBlau'scapital 6,
000
50,
000
Contributi
onofLi nd (
40,
000)

36.Whi
choft
hef
oll
owi
ngc
onc
erni
ngt
hef
ormat
ionoft
hepa
rtner
shi
pbus
ine
ssi
scor
rec
t?

a
. Phi
li
ppi
neFi
nanc
ialRe
por
tingSt
andar
d(PFRS)al
lowsr
ecogni
ti
onofgoodwi
llar
isi
ngf
rom t
he
f
orma
tionofpar
tne
rshi
p.
b. Thej
uri
dic
alper
sona
lit
yoft
hepar
tne
rshi
par
ise
sfr
om t
hei
ssuanc
eofc
ert
ific
ati
onof
r
egi
str
ati
on.
c
. Thepart
iesmaybecomepar
tne
rsonl
yuponc
ont
ribut
ionofmone
yorpr
ope
rtybutnotof
i
ndustr
yors e
rvi
ce.
d. Thec
api
talt
obec
redi
tedt
oeac
hpa
rtne
ruponf
orma
tionma
ynotbet
heamount
 Page | 19

37.Undert
hegener
all
yac
cept
eda
ccount
ingpr
inc
ipl
esi
nthePhi
li
ppi
nes
,wha
tist
he
ac
cept
abl
ereasonwhentheamountcredi
tedtoapart
nerisgr
eat
erthant
heamount
ac
tual
lyc
ontri
butedbys
uchapartnerduringpar
tner
shipfor
mation?

a. Rec
ognit
ionofgoodwi
llbyvi
rtuei
b. ₱4,
110.
c. ₱4,
250.
d. ₱4,
870.

38.Her
efer
stoapar
tnerwhocont
ribut
esnotonl
ymoneyandpr
oper
tybutal
soi
ndus
tryt
o
t
henewlyf
ormedpart
ner
ship.

a.Industr
ialpartner
b. Nominalpartner
c. Capi
tal
ist-
industr
ialpar
tne
r
d. Capi
tal
istpartner

39.I
tref
erst
oat
ypeofpa
rtner
shi
pwher
einal
lpa
rtner
sar
eli
abl
etot
hec
redi
tor
spr
o-r
ataup
t
otheext
endofper
sona
lors
epar
ateas
set
saf
tert
hepa
rtner
shi
p'sas
set
sar
eexhaus
ted.

₱118,
1. 0002.
₱120,
0003.
₱130,
000
₱144,
4. 000

13
40.Regi
na,
Jes
sic
a,andNa
tal
yent
eredi
ntoac
ont
rac
tofpa
rtner
shi
pwi
that
otalc
api
tal
expenditur
eofP5,
000.Thepar
tiesfai
ledt
oregi
stert
hei
rar
tic
lesofc
o-par
tner
shi
pwi
tht
he
Securi
tiesandExc
hangeCommi ssi
on.

a
. Thec
ont
rac
tofpa
rtne
rshi
pisvoi
dbe
caus
ethel
aw pr
ovi
dest
hatwhe
nthec
api
talc
ont
ribut
ions
i
satl
eas
tP3,
000i
tmus
tber
egi
ste
redwi
thSec
uri
ti
esandExc
hangeCommi
ssi
on.
b. Thecont
rac
tofpart
ners
hipwi l
lbindthethi
rdper s
ons.
c. Thecont
rac
tofpart
ners
hipremainstobevalid.
d. Thepart
ners
hipbusi
nessdoesnotobtai
njuri
dicalper
sona
lit
yforf
ail
uret
ore
gis
terwi
th
Se
cur
it
iesandEx
changeCommi
ssi
on.

41.Whi
choft
hef
oll
owi
ngt
rans
act
ionss
hal
lnotaffec
tthec
api
talba
lanc
eoft
hepa
rtner
?

a. Shar
eofapar t
nerinthepartners
hip'
sne tl
oss
b. Rece
iptofbonusbyapar t
nerfrom anotherpartnerbase
dont
hea
gre
eme
nt.
c. Advancesmadebyt hepart
ne r
shiptoapar t
ner.
d. Additi
onali
nvest
mentbyapar t
nertothepar t
ne r
ship

42.I
ntheabs
enc
eofagr
eementast
othedi
str
ibut
ionofpr
ofit
,how s
hal
lthepa
rtner
shi
ppr
ofit
bedi
str
ibut
edt
othepa
rtner
s?
 Page | 20

a
. Thei
ndus
tri
alpar
tne
rshal
lre
cei
veas
har
eequi
val
entt
othel
eas
tshar
eofac
api
tal
is
tpar
tne
rs
whi
let
hec
api
tal
is
tpar
tne
rss
hal
lshar
ebas
edonc
api
talc
ont
ribut
ionr
ati
o
b. Theindustr
ialpar
tnershallr
ecei
veajus
tandequitabl
eshareandthere
mainders
hal
lbe
di
str
ibutedtothecapi
tali
stpart
nersonthebas
isofcapit
alc
ontri
buti
onrat
io.
c
. Theprofits
hal
lbedi
str
ibutedont
hebas
isofl
ossc
ont
ribut
ionr
ati
owhi
chma
yha
vebe
en
agr
eeduponbyt
hepar
tners.
d. Thepr
ofits
hal
lbedi
str
ibut
ede
qua
llyt
oal
lpar
tne
rsi
ncl
udi
ngt
hei
ndus
tri
alpar
tner
.

43.I
ntheabs
enc
eofagr
eementast
othedi
str
ibut
ionofl
oss
,how s
hal
lthepar
tner
shi
plos
sbe
di
str
ibut
edt
othepa
rtner
s?
a. Thel
osss
hallbedist
ribut
edequal
lyt
oallpart
ne r
sinc
ludingt
hei
ndustr
ialpart
ner.
b. Thei
ndust
rialpar
tnershal
lbeexe
mptedfrom part
ner
shiplos
swhil
ethecapit
ali
stpar
tne
rs
s
hal
lshar
eequa
lly
.
c
. Theindus
tri
alpart
ner
ss hal
lbeexe
mptedfrom par
tner
shi
plosswhi
let
hec
api
tal
is
tpar
tner
s
shal
lbedi
str
ibute
dont hebasi
sofcapi
talc
ontr
ibuti
onrat
io.
d. Theindus
tri
alpa
rtne
rshallbeexempt
edfrom par
tner
shipl
osswhil
ethec
api
tal
is
tpar
tne
rs
shal
lbedis
tri
but
edinacc
or danc
ewiththepr
ofita greeme
ntrat
io.

44.Whi
choft
hef
oll
owi
ngwi
lldec
reas
ethec
api
talba
lanc
eofapa
rtner
?
a. Shar
einpar t
ners
hipprofit
b. Rece
iptofsharei
nreval
ua t
ionsur
plusf
rom apar
tne
rshi
ppr
oper
ty,pl
an,
ande
qui
pment
c. Drawingmadebyapa rtner
d. Advancesmadebyapar tnert
othepart
ner
ship

45.Whi
choft
hef
oll
owi
ngs
tat
ement
spe
rtai
nst
opa
rtner
shi
pdi
ssol
uti
on?
a
.Itr
efer
stot
hepr
oces
sofc
onver
tingt
henon-
cas
has
set
soft
hepar
tne
rshi
panddi
str
ibut
ingt
he
t
otalc
asht
othec
redi
tor
sandt
her
emai
ndert
othepar
tne
rs.
b. Itr
efer
stot
hechangeinther
ela
tionoft
hepar
tne
rsc
aus
edbyanypar
tne
rce
asi
ngt
obe
ass
ocia
tedi
nthecarr
yingonofthepart
ner
shi
p.
c.Itre
fer
stot
heext
ingui
shmentoft
hejuri
dic
alper
sonal
it
yoft
hepar
tne
rshi
p.
d. I
tre
fer
stot
heendofthel
if
eofthepart
ners
hip

46.Whi
choft
hef
oll
owi
ngwi
llnotr
esul
tint
hedi
ssol
uti
onofapar
tner
shi
p?
a.I ns
olvencyoft hepartners
hip
b. Admi ss
ionofane w par t
nerinanexi
sti
ngpart
ners
hip.
c. Assi
gnme ntofane xi
sti
ngpartne
r’si
nte
res
ttoathi
rdpers
on.
d. Reti
reme ntofpartner.

47.Whi
choft
hef
oll
owi
ngs
tat
ement
sisc
orr
ectwhe
nane
w par
tneri
sadmi
tt
edt
oanexi
sti
ng
par
tner
shi
pbypur
chas
ingapor
tionofac
api
tali
nter
estofanexi
sti
ngpa
rtner
?
a.I twil
lresul
tinre
val
ua t
ionorimpai
rme
ntofexis
tingasset
softhepartne
rshi
p.
b. Thepartner
shipwil
lrecogni
zegai
norl
ossi
nt hetrans
ferofc
apitalf
rom onepar
tne
rtoanot
her
part
ner.
 Page | 21

c. Thepar t
nershipisnotdi
ssol
vedbyt
headmissi
onofanew par
tnerbypurchas
e.
d. Itwil
ljustre
s ul
tincredi
ttot
hecapi
talne
wlyadmi
ttedpa
rtnerwithcor
res
pondingde
bitt
o
capi
talofthes e
lli
ngpart
ner.

48.I
ncas
eoft
headmi
ssi
onofane
w par
tneri
nanexi
sti
ngpar
tner
shi
pthr
oughi
nves
tmentt
o
thepar
tnershi
p,whi c
hoft
hef
oll
owi
ngs
cenar
ioswi
llr
esul
tinabonust
othene
w par
tner
andassetr
evalua
tion?

a
. Thetotalcont
ribute
dcapit
alofal
lpart
nersi
sequalt
othetot
alagreedcapi
talofane
w
part
nershipwhi l
etheagr
eedcapi
talofne
w part
nerishi
gherthantheamounthehas
cont
ribute
d.
b. Thetotalcont
ribute
dcapit
alofal
lpart
ne r
sismorethanthetot
alagre
edcapi
talofne
w
part
nershipwhi l
etheagr
eedcapi
talofthenew par
tneri
slowerthantheamounthehas
cont
ribute
d.
c. Thetotalcont
ributedcapit
alofal
lpart
ne r
sisl
essthanthetotalagreedcapi
talofnew
part
nershipwhi l
et heagr
eedcapit
alofthenew par
tnerishigherthantheamounthehas
cont
ribute
d.
d. Thetotalcont
ributedcapit
alofal
lpart
ne r
sismorethanthet ot
alagreedcapit
alofnew
par
tner
shi
pwhi
let
het
otalagr
eedc
api
talofol
dpar
tne
rsi
sequa
ltot
heamountt
hey
c
ont
ribut
ed.

49.I
fapar
tnerwhor
eti
redf
rom t
hepa
rtner
shi
prec
eivesl
esst
hant
hec
api
talba
lanc
ebe
for
e
r
eti
rementwhic
hal
sor
esul
tedi
nadec
reas
eint
hec
api
talba
lanc
eofr
emai
ningpa
rtner
s,
whichi
scorr
ect
?
a. Thereti
ringpartnerrecei
vesabonusfrom t
her e
mai ni
ngpart
ner
.
b. Ani mpairmentlossi
sr ecogni
zedbef
oreret
ireme nt
.
c. Revalua
tionsurplusisrecogni
zedbef
orereti
reme nt
.
d. Thereti
ringpartnergivesabonustotheremainingpart
ner
.

50.I
tref
erst
othepr
oces
sofc
onver
tingt
henon-
cas
has
set
soft
hepa
rtner
shi
panddi
str
ibut
ing
t
het
otalc
asht
othec
redi
tor
sandt
her
emai
ndert
othepa
rtner
s.
a. Dissoluti
on
b. Termina t
ion
c. Liquidati
on
d. Ope rat
ion

51.I
ntheli
qui
dat
ionofagener
alpar
tner
shi
p,whi
choft
hef
oll
owi
ngc
redi
tss
hal
lbepai
d
firs
t?

a. Thos
eowi
ngt
othi
rdpers
ons.
b. Thos
eowi
ngt
opart
ner
sothert
hancapi
talandprofits.
c. Thos
eowi
ngt
opart
ner
sforthe
irc
apit
alcontr
ibut
ions
.
d. Thos
eowi
ngt
opart
nersf
orthe
irs
hareinprofits.

52.I
nthel
iqui
dat
ionofal
imi
tedpa
rtner
shi
p,whi
choft
hef
oll
owi
ngc
redi
tss
hal
lbepa
id
l
ast
?
 Page | 22

a. Thos
eowi
ngt
othi
rdper sons.
b. Thos
eowi
ngt
oli
mitedpar tner
s
c. Thos
eowi
ngt
ogeneralpartner
sfortheirshar
einprofit
s.
d. Thos
eowi
ngt
opartnersf
ort hei
rcapit
alcontr
ibut
ion.

53.Wha
tist
henat
ureofl
iabi
li
tyofgener
alpa
rtner
sast
opa
rtner
shi
pde
btsorobl
igat
ions
?
a
. Theyareli
abl
eequal
lyupt
othee
xte
ntoft
hei
rse
par
ateas
set
saf
tert
hepar
tne
rshi
pas
set
sar
e
exhaus
ted.
b. Theyareli
abl
epr
o-r
ataupt
othee
xte
ntoft
hei
rse
par
ateas
set
saf
tert
hepar
tne
rshi
pas
set
sar
e
exhaus
ted.
c. Theyareli
abl
epro-r
atauptotheext
entofthei
rcapi
talcont
ributi
ononly.
d. Theyareli
abl
esoli
dari
lyuptotheext
entofthei
rsepara
teassetsaf
tert
hepar
tne
rshi
pas
set
sar
e
exhaus
ted.
54.Wha ti
sthenat
ureofl
iabi
li
tyofl
imi
tedpar
tner
sast
oli
mit
edpar
tner
shi
pde
btsor
obl
igati
ons?

a
. The
yar
eli
abl
eequal
lyupt
othee
xte
ntt
hei
rse
par
ateas
set
saf
tert
hepar
tne
rshi
pas
set
sar
e
e
xhaus
ted.
b. The
yar
eli
abl
epr
o-r
ataupt
othee
xte
ntoft
hei
rse
par
ateas
set
saf
tert
hepar
tne
rshi
pas
set
sar
e
e
xhaus
ted.
c. The
yar
eli
abl
epro-r
ataupt
ot heext
entofthe
ircapi
talcont
ribut
iononl
y.
d. The
yar
eli
abl
eequall
yuptotheexte
ntofthei
rcapit
alcontr
ibuti
ononly
.

55.Thepar
tner
shi
pagr
eementofRei
dandSi
mm pr
ovi
dest
hati
nter
esta
t10% perye
ari
stobe
cr
edi
tedtoeachpa r
tneront
hebasisofwei
ghted-
aver
agec api
talbal
ances
.Asummar
yof
Si
mm’ sc
apitalac
countfort
heyearendedDec
ember31 ,2003,
isasfol
lows:
Bal
anc
e,J
anua
ry1.
.
..
..
.
..
..
.
..
.140,
000
Addi
ti
ona
linves
tment
,Jul
y1.
.
..
40,
000
Wit
hdrawa
l,August1.
..
.
..
..
..
..
.(
15,
000)
Bal
anc
e,December31.
.
..
..
..
..
165,
000
Whatamountofi
nter
ests
houl
dbec
redi
tedt
oSi
mm’
scapi
tala
cc or2003?a
ountf .
15,
250
b. 15,
375
c. 16,
500
d. 17,
250

56.KernandPatearepartnerswit
hc apit
albal esof₱6
anc 000and₱20,
0, 000,res
pecti
vely.
Profitsandlossesar
edi vi
dedint herati
oof60:40.
Ke r
nandPatedec idedtoform anew
part
ners
hipwi t
hGr ant,whoinvestedlandvaluedat₱15,000f
ora20% c api
tali
nter
estin
thenew par
tner
shi
p. Grant’
scostoft
hel s₱12,
andwa 000.Thepart
nershi
pelec
tedtouse
thebonusmethodtorecordtheadmissi
onofGr
anti
ntothepar
tnershi
p.Grant
’scapi
tal
accounts
houldbecredi
tedfor

a. 12,
000
b. 15,
000
 Page | 23

c. 16,
000
d. 19,
000

57.OnJ
une30,200
3,t
hec
ondens
edbal
anc
esheetf
ort
hepa
rtner
shi
pofEddy,
Fox,
and
Grimm,toget
herwi
ththei
rres
pecti
veprofitandlossshari
ngpercent
ageswereasf
ollows
(
pleas
eseea t
tac
hmentf
orthecondens
edbal
ancesheet):Eddydec
idedtoret
irefr
om the
partnershi
pandbymut uala
greementistobepaid₱180,
000outofpart
ners
hipfundsfor
hisinter
est.Nogoodwil
list
ober ec
orded.Aft
erEddy’sr
eti
rement,whatar
ethecapi
tal
balancesoftheot
herpart
ners
?

a.
Fox:84
,000Gr
imm:56,
000
b. Fox:102,
000Gr
imm:68,
000
c. Fox:108,
000Gr
imm:72,
000
d. Fox:120,
000Gr
imm:80,
000

58.OnJ
une30,200
3,t
hec
ondens
edbal
anc
esheetf
ort
hepa
rtner
shi
pofEddy,
Fox,
and
Gr
imm,t
oget
herwi
tht
hei
rres
pec
tivepr
ofitandl
osss
har
ingper
cent
ageswe
reasf
oll
ows
(
pleas
eseeat
tac
hmentf ort
hecondens
edbalanc
esheet
):As
sumei nst
eadt
hatEddy
r
emainsint
hepa r
tner
shipandthatHamm i
sadmitt
edasanew part
nerwit
ha2 5% i
nter
est
inthecapit
alofthene w part
ners
hi pforac
ashpaymentof₱140,
000.Thebonusmethod
shallbeusedtorecordtheadmissionofHamm. I
mmedi at
elyaft
ertheadmis
sionofHamm,
Eddy’scapit
alac
c ountbalances
houl dbe
 Page | 24

a.
280,
000
b. 172,
500
c. 160,
000
d. 140,
000
18
59.
Thefoll
owingcondensedba
lanc
esheeti
spresentedforthepar
tners
hipofAlfaandBeda,
whoshar
epr ofit
sandl oss
esi
ntherat
ioof60:
40,respec
tivel
y(pl
easeseeat
tac
hmentofthe
c
ondens
edbal
anc
eshe
et)
:Theas
set
sandl
iabi
li
ti
esar
efai
rlyval
uedont
heba
lanc
eshee
t.Al
fa
andBedadecidet
oadmitCappasanew part
nerwit
h20% inter
est
.Nogoodwi
llorbonusi
stobe
rec
orded.Whatamounts
houldCappcontr
ibutei
ncashorotheras
set
s?

a.
110,
000
b. 116,
000
c. 140,
000
d. 145,
000

60.Thef
oll
owingcondens
edbalanc
es heetispr
esentedforthepartnershi
pofAl f
aandBeda ,
whosharepr
ofitsandlos
sesinther at
ioof60:
40,respect
ivel
y(pleaseseeat
tachmentoft
he
c
ondens
edbal
anc
eshe
et)
:Ins
teadofadmi
tti
nganew par
tner
,Al
faandBedade
cidet
o
l
iqui
dat
ethepar
tner
shi
p.I
ftheot
heras
setsar
esol
dfor₱500,
000,whatamountoft
he
a
vail
abl
ecashs
houldbedi
str
ibut
edtoAlf
a?
 Page | 25

a.
255,
000
b. 273,
000
c. 327,
000
d. 348,
000

61.Whichofthefoll
owi
ngi
sNOTpar
toft
hema
jorc
ons
ider
ati
onsi
nac
count
ingf
ort
heequi
ty
ofapart
nership?
a. Acc
ountingf
orinvestment
stot
hepar
tne
rshi
p
b. Di
visi
onofprofit s
c. Admissi
onofane w par
tner
d. Hir
ingofemployees

62.Thepe
rsonwhoas
sumesf
ullc
o-owne
rshi
pofapar
tner
shi
pinc
ludi
ngunl
imi
tedl
iabi
li
tyi
s
a
. s
olepr
opr
iet
or.
b. shar
e holder
c.l i
mitedpar t
ner
d. generalpart
ner

63.Whenapar
tneri
nves
tsass
etsothert
hancashi
ntoapar
tner
shi
p,t
hes
eas
set
sshoul
dbe
l
ist
edont
heStat
ementofFinanci
alPos
iti
onat

a. Thei
rcarryingval ue
b. Thevaluethei nvest
ingpar
tneras
signe
dtot
hem
c. Thei
ror i
ginalcost
d. Thei
rfairmar ketvalue

64.Pi
oandRe
yshar
epr
ofit
sint
her
ati
oof3:
2.Howe
ver
,Pi
oist
orec
eiveabonusof20% oft
he
profits,i
naddi
tiontohi
sprofitshar
e.Thepar
tner
shi
pmadeapr ofitfortheyearofP24,
000
befor
ethebonus
.As s
umingPio’
sbonusisc
omputedonprofitaf
terdeduc
tingsai
dbonus ,
how muc
hpr
ofits
har
ewi
llReyr
ecei
ve?
a. P8,
000
b. P9,
000
 Page | 26

c. P9,
600
d. P15,
200

65.Apar
tnerhasac
api
talbal
anc
eofP4
00,
000f
orfivemont
hs,
P500,
000f
orf
ourmont
hs,a
nd
P600,
000flort
hreemont
hs.Theaver
agec
api
talbal
anc
eis
a. P483,
333
b. P485,
000
c. P491,
680
d. P500,
000

66.Keit
hinvestedP100,
000f
oraone-t
hir
dint
eresti
napar
tner
shipinwhichtheot
herpart
ners
havecapi
taltot
ali
ngP260,
000bef
oreadmi
tti
ngKeit
h.Aft
erthedis
tri
buti
onofthebonus,
wha
tisKei
th’
sCapi
tal
?
a. P53,
330,
000
b. P86,
670
c. P100,
000
d. P120,
000

2067.Apa
rtneras
signe
dhi
spar
tner
shi
pint
eres
ttoat
hir
dpa
rty.
Whi
ch
s
tat
ementbes
tdes
cri
best
hel
egalr
ami
fic
ati
onst
otheas
signee
?
a
. Theas
signme
ntoft
hepar
tne
rshi
pint
ere
stdoe
snote
nti
tl
etheas
signeet
opar
tne
rshi
pas
set
s
uponal
iqui
dat
ion.
b. Theass
ignme ntdissol
vesthepar
tner
ship.
c. Theass
igneehast herighttos
harei
nthemana geme ntoft
hepar tner
shi
p.
d. Theass
igneedoe snotbe c
omeapartnerbuthasther i
ghtt
os hareinfut
urepar
tne
rshi
ppr
ofit
s
andtorec
eivethepr opershar
eofpart
nershi
passetsuponliquidati
on.

68.TheXYZ part
nershi
p pr
ovi
desa10% bonusto Part
nerY thati
sba s
ed upon part
ner
shi
p
i
ncome,af
terdeduct
ionoft
hebonus
.Ifthepart
ne r
ship'
sincomeisP121,
000,how muchi
s
Par
tner
'sbonusal
loc
ati
on?
a. P11,
000.
b. P11,
450.
c. P11,
650.
d. P12,
100.
69.Ifthe part
nershi
p agr
eementpr
ovi
desa f
ormul
afort
he c
omput
ati
on ofa bonust
othe
par
t ner
s,t
hebonuswoul dbec
omput
ed
a. nexttolast
,becauset
hefinalal locat
ionist
hedis
tri
but
ionoft
hepr
ofitr
esi
dua
l.
b. beforeinc
omet axall
ocat
ionsaremade .
c. aft
e rt
hesalar
yandi nter
estall
ocati
onsaremade.
d. inanymannera gr
eedtobyt hepartne
rs.
 Page | 27

70.Inali
mitedpar
tner
shi
p,ageneralpart
nera.i
sex c
ludedfrom management.b.i
snotent
itl
edt o
abonusattheendoftheyear
.c .ha
slimit
edl i
abili
tyforpart
ners
hi pdebit
.d.hasunl
imi t
ed
l
iabi
li
tyf
orpa
rtner
shi
pde
bit
.
a.i sexc
ludedfrom mana geme nt
.
b. isnotenti
tl
edt oabonusa ttheendoft heyear
.
c. hasli
mi t
edliabil
it
yforpar t
nershi
pde bit
.
d. hasunlimit
edl i
abil
it
yf orpart
nershi
pde bit
.

“It is the Lord who goes before you. He will be with you; he will not fail you or forsake you. Do not fear or be

dismayed.” – (Deuteronomy 31:8)