Module 1 – Partnership Accounting

Unit 1.1 – Partnership Formation

Name: Simbala, Andi Te’a Mari O Date: 6/20/2020
Instructor: Conrado B. Chan JR., CPA, MBA Class Code: 1330 Score

REQUIREMENT A. Compute for the adjusted balances in the partners’ capital Accounts
To Record Adjustments:
A, Capital 40,000
Accounts Receivable 40,000
To record uncollectible accounts.

B, Capital 20,000
Mortgage Payable 20,000
To record unpaid mortgage.

B, Capital 50,000
Accumulated Depreciation 50,000
To record under depreciation of building.

Note Payable 30,000

A, Capital 30,000
To record discount on note payable.

Unadjusted Capital of A 340,000

Adjustments:
a. Uncollectible Accounts (40,000)
b. Discount on Note Payable 30,000 (10,000)
Adjusted Capital of A 330,000

Unadjusted Capital of B 340,000

Adjustments:
a. Mortgage Payable (20,000)
b. Under depreciation of Building (50,000) (70,000)
Adjusted Capital of B 270,000

Adjusted Capital Contributions

A B
Cash 200,000
Accounts Receivable 100,000
 Allowance for Uncollectible Accounts (40,000)
Inventory 160,000
Land 100,000
Building 240,000
Accumulated Depreciation (50,000)
TOTAL 420,000 290,000

Note Payable 90,000

Mortgage Payable 20,000
A, Capital 330,000
B, Capital 270,000
TOTAL 420,000 290,000

REQUIREMENT B. Assume that a partner’s capital shall be increased accordingly by contributing

additional cash to bring the partners’ capital balances proportionate to their profit or loss ratio. Which
partner should provide additional cash and how much is the additional cash contribution?
B, Capital 270,000
Divided by: 0.4
Should by Capital 675,000
Less: B, Capital 270,000
Expected Contribution of A 405,000
Less: A, Capital 330,000
Additional Cash Contribution of A 75,000

Module 1 – Partnership Accounting

Unit 2.1 – Partnership Operation
Name: Simbala, Andi Te’a Mari O Date: 6/20/2020
Instructor: Conrado B. Chan JR., CPA, MBA Class Code: 1330 Score

1.
Loss 33,000
Divide by: # of Partners 3
Share of each partner 11,000

2.
AAA BBB CCC TOTAL
Interest
100,000 x 10% 10,000
150,000 x 20% 30,000
60,000 x 5% 3,000 3,000 46,000
Remaining
204,000 / 3 68,000 68,000 68,000 204,000
 TOTAL C. 108,000 71,000 71,000 250,000

3.
Adam Eve Balance
480,000
Salary 60,000 60,000 360,000
Bonus 60,000 300,000
Remaining 150,000 150,000 --
TOTAL 270,000 D. 210,000

4.
Bonus = 0.1 (Income – Bonus – Salary)
15,000 = .1 Income – (0.1 x 15,000) – (0.1x 125,000)
15,000 = 0.2 Income – (1,500) – (12,500)
15,000 + 1,500 + 12,500 = 0.1 Income
29,000 = 0.1 Income
Income = B. 290,000

5.
Initial contribution, March 1 50,000 x 12/12 41, 667
Additional Contribution, June 1 20,000 x 7/12 11,667
Withdrawal exceeding P 10,000 5,000 x 4/12 (1,667)
Weighted Average Capital 51,667

6. A. 11,688

Module 1 – Partnership Accounting

Unit 3.1 – Partnership Dissolution
Name: Simbala, Andi Te’a Mari O Date: 6/20/2020
Instructor: Conrado B. Chan JR., CPA, MBA Class Code: 1330 Score

1. D. AAA and BBB’s old profit and loss ratio

2. A. Was recorded as goodwill
3. A. Reduction in capital of P 15,000 each for C and D
4. A. P 600,000 , P 600,000
5. D. P 46,200
6. D. P 77,000 and P 186,000
 Module 1 – Partnership Accounting
Unit 4.1 – Partnership Liquidation
Name: Simbala, Andi Te’a Mari O Date: 6/20/2020
Instructor: Conrado B. Chan JR., CPA, MBA Class Code: 1330 Score

1.
B
            In the distribution of the P60,000 cash, A received P26,000, computed as follows:
                                                   Total            A           B
Initial contributions                        P 50,000      P30,000       P20,000
Equiv. Investments (payments)                          132,970        62,275                       70,695
Equiv. Withdrawals (receipts)          (144,345)    (79,100)     (65,245)
Balances before profit share           P  38,625      P13,175       P25,450
Profit (P60,000-P38,625), 6:4             21,375       12,825          8,550
Distribution of P60,000 cash            P 60,000      P26,000       P34,000

2.

3.