DG and DV have capital balances of P1,200,000 and P800,000 and share profits 3:2.
DL is
admitted as a partner and is given a 25% interest in the firm by investing P500,000. Profits and
losses are now to be shared 4:3:2 by DG, DV and DL. After a couple of months, DK subsequently
entered the partnership by investing another P500,000 for a capital credit of P455,000 and a 19%
share on the firm’s profits. Former partners share the balance of profits and losses in their
original ratio. Assuming there is no asset revaluation.
DG had difficulty getting along with DK and decided to withdraw from the partnership. The
remaining partners accepted his retirement and the partnership paid him P1,241,000 for his
interest.
6. What is the entry to record the admission of DL into the partnership?
a. Cash 625,000
DL, Capital 625,000
b. Cash 500,000
DG, Capital 75,000
DV, Capital 50,000
DL, Capital 625,000
c. Cash 500,000
DL, Capital 500,000
d. Cash 625,000
DG, Capital 75,000
DV, Capital 25,000
DL, Capital 500,000
7. What is the entry to record the admission of DK into the partnership?
a. Cash 500,000
DG, Capital 20,000
DV, Capital 15,000
DL, Capital 10,000
DK, Capital 455,000
b. Cash 500,000
DG, Capital 20,000
DV, Capital 15,000
DL, Capital 10,000
DK, Capital 545,000
c. Cash 455,000
DK, Capital 455,000
d. Cash 500,000
DK, Capital 500,000
8. What is the entry to record the withdrawal of DG from the partnership?
a. DG, Capital 1,145,000
DV, Capital 40,500
DL, Capital 27,000
DK, Capital 28,500
Cash 1,241,000
b. DG, Capital 1,241,000
Cash 1,241,000
c. DG, Capital 1,145,000
DV, Capital 40,500
DL, Capital 27,000
DK, Capital 28,500
Cash 1,049,000
d. DG, Capital 1,145,000
Cash 1,145,000
9. Compute the capital balances of (1) DV (2) DL and (3) DK, respectively after DV’s withdrawal
a. (1) 805,500; (2) 662,000; (3) 483,500
b. (1) 765,000; (2) 635,000; (3) 455,000
c. (1) 739,500; (2) 618,000; (3) 471,500
d. (1) 724,500; (2) 608,000; (3) 426,500