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AFAR1 Partnership Formation Solution

The document contains several problems related to partnership formation and accounting. Problem 1 shows the capital contributions of two partners totaling $550,000. Problem 2 shows the capital contributions of three partners totaling $480,000. Problem 3 shows accounting information for five partnerships including capital contributions, current accounts, bonuses, and revaluations. Problem 4 shows accounting information for one partnership including capital contributions, current accounts, and bonuses. Problem 5 shows accounting information for two partners totaling $360,000 in capital contributions. Problems 6 and 7 show unadjusted and adjusted accounting information for two sole proprietorships.

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64 views3 pages

AFAR1 Partnership Formation Solution

The document contains several problems related to partnership formation and accounting. Problem 1 shows the capital contributions of two partners totaling $550,000. Problem 2 shows the capital contributions of three partners totaling $480,000. Problem 3 shows accounting information for five partnerships including capital contributions, current accounts, bonuses, and revaluations. Problem 4 shows accounting information for one partnership including capital contributions, current accounts, and bonuses. Problem 5 shows accounting information for two partners totaling $360,000 in capital contributions. Problems 6 and 7 show unadjusted and adjusted accounting information for two sole proprietorships.

Uploaded by

Venti Alexis
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as XLSX, PDF, TXT or read online on Scribd
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ADVANCED FINANCIAL ACCOUNTING AND REPORTING

PARTNERSHIP FORMATION

PROBLEM 1 CC AC
C R 175,000 175,000
O 375,000 375,000
Total 550,000 550,000

PROBLEM 2 CC AC
B II 150,000 150,000
JJ 160,000 160,000
KK 170,000 170,000
Total 480,000 480,000

PROBLEM 3 CC AC
1. C AA 36,000 36,000
BB 81,000 81,000
Total 117,000 117,000

Bonus/
PROBLEM 3 CC AC Revaluation
2. A AA 36,000 46,800 10,800
BB 81,000 70,200 (10,800)
Total 117,000 117,000 -

Bonus/
PROBLEM 3 CC AC
Revaluation
3. B AA 36,000 54,000 18,000
BB 81,000 81,000 -
Total 117,000 135,000 18,000

Bonus/
PROBLEM 3 CC AC
Revaluation
4. D AA 36,000 36,000 -
BB 81,000 54,000 (27,000)
Total 117,000 90,000 (27,000)

Bonus/
PROBLEM 3 CC AC
Revaluation
5. D AA 36,000 36,000 -
BB 81,000 54,000 (27,000)
Total 117,000 90,000 (27,000)

Bonus/
PROBLEM 4 CC AC
Revaluation
B Aldo 78,500 53,200 (25,300)
Bert 48,600 53,200 4,600
Chris 32,500 53,200 20,700
Total 159,600 159,600 -
Bonus/
PROBLEM 5 CC AC
Revaluation
Charlie 198,000 198,000 -
Delta 162,000 162,000 -
Total 360,000 360,000 -

1. C FV of the Machine 113,000


2. A FV of the Equipment 107,000
3. D Total Agreed Capitalizatio 360,000

PROBLEM 6 Book of E Unadjusted Adjusted


A Cash 2,600 2,600
Accounts receivable 12,000 11,760
Merchandise inventory 18,000 20,200
Prepaid Expenses - 350
Accounts payable 6,200 6,200
Accrued Expenses - 400
E, Capital 26,400 28,310

Bonus/
CC AC
Revaluation
E 28,310 28,310 -
R 14,155 14,155 -
Total 42,465 42,465 -

PROBLEM 7 Book of Atta Unadjusted Adjusted


A Cash 28,000 28,000
Accounts receivable 200,000 180,000
Inventories 120,000 114,000
Land 600,000 600,000
Building - -
Furniture & fixtures 50,000 50,000
Intangible assets 2,000 -
Accounts payable 180,000 180,000
Other liabilities 200,000 200,000
Atta, Capital 620,000 592,000

Book of Boy Unadjusted Adjusted


Cash 62,000 62,000
Accounts receivable 600,000 560,000
Inventories 200,000 193,000
Land - -
Building 500,000 500,000
Furniture & fixtures 35,000 35,000
Intangible assets 3,000 -
Accounts payable 250,000 250,000
Other liabilities 350,000 350,000
Boy, Capital 800,000 750,000

Bonus/
CC AC
Revaluation
Atta 592,000 592,000 -
Boy 750,000 750,000 -
Total 1,342,000 1,342,000 -

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