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Illustration: Formation of Partnership Valuation of Capital A B

A and B formed a partnership. A contributed P230,000 in cash, accounts receivable, inventory, and land. B contributed P170,000 in cash, building, and land. Additional details provide adjustments to accounts like recognizing an uncollectible receivable, estimated costs of inventory, mortgages on land and building, and depreciation of building. The partnership agreement states A and B will share profits and losses at a 60-40 ratio.

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Arian Amurao
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233 views2 pages

Illustration: Formation of Partnership Valuation of Capital A B

A and B formed a partnership. A contributed P230,000 in cash, accounts receivable, inventory, and land. B contributed P170,000 in cash, building, and land. Additional details provide adjustments to accounts like recognizing an uncollectible receivable, estimated costs of inventory, mortgages on land and building, and depreciation of building. The partnership agreement states A and B will share profits and losses at a 60-40 ratio.

Uploaded by

Arian Amurao
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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ILLUSTRATION: FORMATION OF PARTNERSHIP VALUATION OF CAPITAL

A and B formed a partnership. The following are their contributions


A B
Cash 100,000
Accounts Receivable 50,000
Inventory 80,000
Land 50,000
Building 120,000
Total 230,000 170,000

Note payable 60,000


A, Capital 170,000
B, Capital 170,000
total 230,000 170,000

Additional information:
 Included in accounts receivable is an account amounting to 20, 000 which IS
deemed uncollectible 
 The inventory has an estimated selling price of 100,000 and estimated costs
to sell of P10, 000 
 An unpaid mortgage of P10, 000 on the land IS assumed by the partnership. 
 The building is under-depreciated by 25,000. 
 The building also has an unpaid mortgage amounting to 15,000, but the
mortgage is not assumed by the partnership. B agreed to settle the mortgage
using his personal funds. 
 The note payable is stated at face amount. A proper valuation requires the
recognition of a P15, 000 discount on note payable
 A and B shall share in profits and losses 60% and 40% respectively.
Dfsgs

ILLUSTRATION: FORMATION OF PARTNERSHIP VALUATION OF CAPITAL


A and B formed a partnership. The following are their contributions
A B
Cash 100,000
Accounts Receivable 50,000
Inventory 80,000
Land 50,000
Building 120,000
Total 230,000 170,000

Note payable 60,000


A, Capital 170,000
B, Capital 170,000
total 230,000 170,000

Additional information:
 Included in accounts receivable is an account amounting to 20, 000 which IS
deemed uncollectible 
 The inventory has an estimated selling price of 100,000 and estimated costs
to sell of P10, 000 
 An unpaid mortgage of P10, 000 on the land IS assumed by the partnership. 
 The building is under-depreciated by 25,000. 
 The building also has an unpaid mortgage amounting to 15,000, but the
mortgage is not assumed by the partnership. B agreed to settle the mortgage
using his personal funds. 
 The note payable is stated at face amount. A proper valuation requires the
recognition of a P15, 000 discount on note payable
 A and B shall share in profits and losses 60% and 40% respectively.
Sdfjksgjk

ILLUSTRATION: FORMATION OF PARTNERSHIP VALUATION OF CAPITAL


A and B formed a partnership. The following are their contributions
A B
Cash 100,000
Accounts Receivable 50,000
Inventory 80,000
Land 50,000
Building 120,000
Total 230,000 170,000

Note payable 60,000


A, Capital 170,000
B, Capital 170,000
total 230,000 170,000

Additional information:
 Included in accounts receivable is an account amounting to 20, 000 which IS
deemed uncollectible 
 The inventory has an estimated selling price of 100,000 and estimated costs
to sell of P10, 000 
 An unpaid mortgage of P10, 000 on the land IS assumed by the partnership. 
 The building is under-depreciated by 25,000. 
 The building also has an unpaid mortgage amounting to 15,000, but the
mortgage is not assumed by the partnership. B agreed to settle the mortgage
using his personal funds. 
 The note payable is stated at face amount. A proper valuation requires the
recognition of a P15, 000 discount on note payable
 A and B shall share in profits and losses 60% and 40% respectively.

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