advanced accounting chapter 4

7/25/2019 Advanced Accounting Chapter 4

1/19

68

Chapter 4

CHAPTER 4

MULTIPLE CHOICE

4-1: a

PAR BOOGIE BIRDIE

Capital balances before realization P 20,000 P 16,000 P 10,000

Loss on liquidation, P40,000 ( 20,000) ( 12,000) ( 8,000)

Cash distribution P P 4,000 P 2,000

4-2: c

PING PANG PONG

Capital balances before liquidation P 50,000 P 50,000 P 10,000

ain of P10,000 (150,000!140,000) ""6,000 ""2,000 ""2,000

Cash distribution P 56,000 P 52,000 P 12,000

4-3: b

PING PANG PONG


Loss of P40,000 (P140,000!P100,000) ( 24,000) ( 8,000

) ( 8,000)

Cash distribution P 26,000 P 42,000 P 2,000

4-4: a

PING PANG PONG


Loss of P#0,000 (P140,000!P#0,000) ( 42,000) ( 14,000) ( 14,000)


2/19

Partnership Liquidation

4-7: a

ARIEL BERT CESAR

Capital balances before liquidation P40,000 P180,000 P %0,000

Loss of P100,000, 4*%*% ( 40,000) ( %0,000

) ( %0,000)

Cash distribution P P1!"!!! P

4-8: b

NOR# OSCARCapital balances before realization P2%,000 P 1%,500

&dditional inest-ent b .or for

t/e unpaid liabilities (%%,000!18,000) 15,000

Loss on realization (sc/edule 1) ( %0,+00) ( 20,600

)

Payment by Oscar to Nory P ,100 ! P,100

"

S$h%du&% 1

otal capital before liquidation P %6,500

npaid liabilities 15,000otal loss on realization P 51,500

4-9: d

BLACK '(ITE GREEN

Capital balances before liquidation (net) P++,000 P +1,500 P1%8,000

Loss on realization (sc/edule 1) P2#,500 ( 1%,#50) ( 2#,500

) "( 5,500)

#a$ances, cash distribution P85,250 P 64,000 P132,500

S$h%du&% 1)

Capital balances of 3/ite (net) P +1,500

Cas/ receied b /ite "8%,250


3/19

Payment to %artners P11,000 P 35,500 P 2,50070

Chapter 4

S$h%du&% 1)

aurus capital (net) P%6,500

Pa-ent to aurus ( 2#,500)

/are of total loss (20) P +,000

otal loss on realization (+,00020) P45,000

4-12: c

TOTAL MONA NORA

OLGA

Capital balances, 9une 11 P%2,#00 P15,000 P1%,500

P 4,200

.et loss fro- operation (squeeze) ( +,800) ( 4,200

) ( 2,800)

( 2,800)

Capital balances, &u'ust %0 before

liquidation (48,500!25,600) P22,+00 P10,800 P10,#00P 1,400

Loss on realization (4#,500!%0,000) ( 1#,500) ( #,500

) ( 5,000)

( 5,000

)

$alances P 5,400 P %,%00 P 5,#00

00)

&dditional inest-ent b :l'a "1,500 """"" """""

"1,500

$alances P 6,+00 P %,%00 P 5,#0000)

7li-ination of :l'as deficienc """""" ( 1,260

) ( 840 )

2,100


4/19

P50,000

Loss on realization

&ccounts nest-ent (P%0,000 ! P20,000) 10,000

7quip-ent (P60,000!P%0,000) "%0,000

otal P60,000 ( 24,000

) ( 24,000)

000)

Payment to %artners P21,000 P 3,000

P38,000

4-15: c TOTAL MONA

Capital balances before liquidation (inclusie loans) P4#,500 P28,500

P1+,000

Loss on realization, (squeeze) ( %8,500

) ( 2%,100)

( 15,400)

Ca%ita$ ba$ances & cash distribution P 9,000 P 5,400P

3,600


Cas/ after realization P %#,500

Less Liabilities (P%6,000!P#,500) ( 28,500)

otal capital after realization P +,000

4-16: a

?? capital before distribution of net loss P100,000

&dd* s/are of net loss (P10,000 = 40) "( 4,000

)?? capital before liquidation +6,000

Cas/ settle-ent to ?? ( 80,000)

?? s/are of total loss on realization (40) P 16 000


5/19

Capital balances after realization

(liabilities!unpaid) (P 25,000) ( 4#,500) ( 15,000)

P%#,5007li-ination of CCs deficienc """"""" ""4#,500 ( 28,500)

( 1+,000

)

$alances (P 25,000) (P4%,500)

P18,500

>nest-ent b ;; ""4%,500 """""" "4%,500

"""""

Payment to (( P 18,500 P P

P18,500

4-18: d

otal capital before liquidation P %0,000

Liabilities ""1,500

otal assets P %1,500

Less* Cas/ balance before realization

Cas/ after pa-ent of liabilities P 11,100pa-ent of liabilities 1,500

Cas/ realized ( 11,600) ""1,000

.on!cas/ asset P %0,500

Less* cas/ realized "11,600

)oss on rea$i'ation P 18,900

72

Chapter 4

4-19: d


6/19

/are of total loss (1%) P 40,000

otal loss on realization (P40,0001%) P120,000

otal assets*otal interest of t/e partners before liquidation*

99 (P#0,000AP%0,000AP10,000) P110,000

@@ (P60,000!P10,000) 50,000

LL (P%0,000AP10,000) ""40,000 P200,000

;iide b """"""50

otal P400,000

Loss on realization "120,000

Cash to be rea$i'ed P280,000

4-21: a

TOTAL NN OO

Capital balances, 9ul 1 P #5,000 P 25,000 P 25,000P 25,000

&dances to .., &u'ust 1 ( 10,000) ( 10,000)

:: Loan, epte-ber 1 20,000 20,000

>nterest, ;ece-ber %1 (6)

.. (5 -osB) ( 250) ( 250)

:: (4 -osB) 400 400

Co-pensation to PP ""2,500 """"""" """""""

"""2,500

Capital balances before liquidation P 8#,650 P 14,#50 P 45,400

P 2#,500

Loss on realization (squeeze) "56,250 ( 1#,550

) ( 1#,550)( 1#,550)

Cas/ distribution P %5,000 ( 2,800

) P 2#,850

+ +50


7/19

Cash to be absorbed P !P 40,000" !P 10,000"

4-23: a

RM ST

Capital balances before realization (net) P500,000 P825,000

Loss on realization, P1,225,000 ( 4+0,000) ( #%5,000)

Payment to Partners P 10,000 P 90,000

4-24: a

TOTAL LT AM Capital balances before realization (net) P 2#,500 P 20,000 P 5,000

P 2,500

ain on realization (squeeze) ""%#,500 "18,#50 ""!+,%#5

""+,%#5

Ca%ita$ ba$ances a.ter rea$i'ation P 65,000 P 38,50 P 14,35

P 11,85

4-25: c AG BM CP

Capital balances before realization (net) P 420,000 P%#5,000 P205,000

P150,000

Loss on realization, P1,000,000 ( %00,000) ( %00,000) (200,000)

(200,000)

$alances P 120,000 P #5,000 P 5,000

P(50,000)

/dditiona$ in*estment by 50,000

4-26: a

ttl t t P%51 500


8/19

Chapter 4

SOLUTIONS TO PROLEMS

P!"b#$% 4 & 1

Case 1

R'(a) a*d !'"*$)

S+a+$%$*+ ", L'.'da+'"*

/$c$%b$! 31 2008

Partn%rs.

Ca/ita&s

Ass%ts Ri0as" Brion%s" Ri0as

Brion%s

Cash Oth%rs Liabi&iti%s Loan Loan 2!34

1!34

$alances before liquidationBB B P 20,000 P200,000 P1%2,000 P 18,000 P 20,000 P40,000

P10,000


9/19

Brion%s

Cash Oth%rs Liabi&iti%s Loan Loan 5!34

6!34$alances before liquidationBB B P20,000 P200,000 P1%2,000 P 18,000 P 20,000 P40,000

P10,000


10/19

$alancesBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBB 22,000 18,000 4,000

Pa-ent to partnerBBBBBBBBBBBBBBBBBBBBBB P(22,000 ) P(18,000 ) P( 4,000 )

ourna$ (ntries

Case 1

Cas/BBBBBBBBB BBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBB 1%4,000


11/19

P!"b#$% 4 & 2

#a*d" a*d Ca)+!"

S+a+$%$*+ ", L'.'da+'"*

A!'# 30 2008

Partn%rs.

Ca/ita&s A s s % t s A$$ounts B&ando" B&ando

CastroCash R%$%i0ab&%s In0%ntor, Oth%rs Pa,ab&% Loan 7!34

8!34

$alances before

liquidationBBBBBBBBBBBBBBBBBBBB P 18,000 P#5,000 P+0,000 P84,000 P42,000 P 24,000 P102,000

P++,000

Collection of

receiables and

distribution of lossBB BB BB BB "%#,500 ( #5,000) """"""" """"""" """"""" """"""" ( 22,500)

( 15,000)$alancesBBBBBBBBBBBBBBBBBBBBBBBBBBBB 55,500 +0,000 84,000 42,000 24,000 #+,500

84,000


12/19

Ca/ita& Ba&an$%s

A9/: Non$ash Liabi&; *o&t" A9/ *o&t 'att

Cash Loan Ass%ts iti%s Loan !3 6!3

$alances 20,000 15,000 1%5,000 %0,000 10,000 80,000 %6,000

14,000ale of

assets at a loss "+5,000 """""" (1%5,000) """""" """""" (20,000) (12,000)

( 8,000)

115,000 15,000 !0! %0,000 10,000 60,000 24,0006,000

Pa-ent to

creditors "(%0,000) """""" """"""" (%0,000) """""" """"""" """""" """"""

85,000 15,000 !0! !0! 10,000 60,000 24,0006,000

:ffset &-p,

receiable (15,000) (15,000)

Pa-ents to partners*Loan (10,000) (10,000)

Capitals "(#5,000) """""" """"""" """"""" """""" (45,000) (24,000)

,000)$alances !0 ! !0! !0! !0! !0 ! !0 ! !0 !

!0!b (1) Cas/ +5,000

&-p, Capital 20,000

Dolt, Capital 12,000att, Capital 8,000

.oncas/ &ssets 1%5,000

S%&& non$ash ass%ts at a &oss o= P8!"!!!:

(2) Liabilities %0,000

Cas/ %0,000

Pa, $r%ditorsB


13/19

78

Chapter 4

P!"b#$% 4 & 4

a $ina, capital before liquidationBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBB P%20,000

Pa-ent to $inaBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBB "128,000

Loss absorbed b $ina (40)BBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBB P1+2,000

Loss on realization (P1+2,000 40)BBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBB P480,000

b AI/A INA CELIA

S+a+$%$*+ ", Pa!+*$!)' L'.'da+'"*

a*.a! 1 2008

Ca/ita&

Cash Oth%r Ass%ts Aida Bina C%&ia

4 84 14

$alances before liquidationB P80,000 P#20,000 P%20,000 P%20,000 P160,000


14/19


P!"b#$% 4 & 6

a $$BBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBB P160,000

CCBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBB P20,000

;;BBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBB P60,000

77BBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBB P 0

b CC // EE

S+a+$%$*+ ", L'.'da+'"*

C a / i t a &

Cash Liabi&iti%s BB 6!34 CC 1!34DD

$alances before liquidationBBBB P 0 P60,000 P160,000 P80,000 (P120,000)

P(180,000)

&dances b $$ to pa liabilities ( 60,000) 60,000;eposit b ;;BBBBBBBBBBBBBBBBBBBBBBB 60,000 """""" """"""" """"""" ""60,000

""""""""

$alancesBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBB 60,000 220,000 80,000 ( 60,000) ( 180,00

0)

7li-ination of 77s deficienc ( +0,000) ( %0,000) ( 60,000) 180,000

7li-ination of ;;s deficienc """""" ""( +0,000) ( %0,000) 120,000

Pa-ent to partnersBBBBBBBBBBBBBBBB 60,000 40,000 20,000

P!"b#$% 4 & 7

Sa)"* a*d C"%a*


15/19

Hobel and PeIaF

45*%0*10BBBBBBBBBBBBBBBBBBBBBB BBBBBB """"""" """""""" """""""" """""" """""" ( #,+%#) ( 5,2+2) 14,++%

1,#64)

$alancesBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBB 1#+,#50 ! ! ! 1,500 85,258 +%,106 !

(114)

:ffset PeIas loan a'ainst

/is capital deficiencBBBBBBBB """"""" """""""" """""""" """""" ( 114 ) """""" """""" """""""

114

$alancesBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBB 1#+,#50 ! ! ! 1,%86 85,258 +%,106 !

Pa-ents to partnersBBBBBBBBBBBBBB P(1#+,#50) P(1,%86) P(85,258) P(+%,106)

80

Chapter 4

P!"b#$% 4 & 8

a A!+ $a a*d C'd Pa!+*$!)'

S+a+$%$*+ ", L'.'da+'"*

.*$ 4 2008

Ass%ts Partn%rs. Ca/ita&Cash Oth%r Liabi&iti%s Art 8!34 B%a 8!34 Cid

$alances before liquidation

(includin' $ea loan, P4,000)BBBBB B P 6,000 P+4,000 P20,000 P2#,000 P4%,000P10,000


16/19

&rt capital (P500 J 40)BBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBB 200

$ea capital (P500 J 40)BBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBB 200

Cid capital (P500 J 20)BBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBB 100

LiabilitiesBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBB 500To r%$ord trad% a$$ounts /a,ab&%B

LiabilitiesB BBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBB 20,500

Cas/BB BBBBBBBBBBBBBBBBBBBBBBB BBBBBBBBB BBBBBBBBB BBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBB BBB 20,500o record pa-ent of liabilitiesB

&rt capitalBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBB 1,%80

$ea capitalBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBB 1,%80

Cid capitalBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBB 2,#60To %&i9inat% Cid.s $a/ita& d%=i$itB

&rt capitalBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBB 100$ea capitalBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBB 4,000

Cid capitalB BBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBB 12,100

Cas/BB BBBBBBBBBBBBBBBBBBBBBBB BBBBBBBBB BBBBBBBBB BBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBB BBB 16,200

To r%$ord /a,9%nts to /artn%rs to $o9/&%t% &iuidation B

c Cids loss -ust be li-ited to P5,000, or P25,000 for t/e partners/ip (P5,000 20 K P25,000)B$ecause t/e liquidation of liabilities results in a loss of P500, onl P24,500 -a be lost on t/e

realization of ot/er assetsB /is requires t/at ot/er assets realize P6+,500 (P+4,000 24,500) toenable Cid to receie P5,000 fro- t/e partners/ip to pa personal creditors in fullB


17/19

P!"b#$% 4 &9

Pa!+*$!)'

S+a+$%$*+ ", R$a#'a+'"* a*d L'.'da+'"*

L.%-).% L'.'da+'"* "* .*$ 30 2008

! Capital $alances !

.oncas/ @ $

Cas/ &ssets Liabilit ies Loan 20 40 40 !

Preliquidation balances 50,000 +50,000 (480,000) (60,000) (240,000) (100,000) (120,000)

ale of assets

and distribution

of 4%0,000 loss 520,000 +50,000 ! ! 86,000 1#2,000 1#2,000

5#0,000 !0! (480,000) (60,000) (154,000) #2,000 52,000

Cas/ contributed

b $ 50,000 ! ! ! ! ! 50,000

620,000 !0! (480,000) (60,000) (154,000) #2,000 2,000

;istribution of deficit

of insolent partner* (2,000)

2060 (P2,000) 666

4060 (P2,000) ! ! ! ! ! 1,%%4 !

620,000 !0! (480,000) (60,000) (15%,%%4) #%,%%4 !0!

:ffset deficit 3it/ loan ! ! ! 60,000 ! (60,000) !

620,000 !0! (480,000) !0! (15%,%%4) 1%,%%4 !0!

Contribution b 1%,%%4 ! (1%,%%4) !

6%%,%%4 !0! (480,000) !0! (15%,%%4) !0! !0!

Pa-ent of creditors (480,000) ! 480,000 ! ! ! !

15%,%%4 !0! !0! !0! (15%,%%4) !0! !0!;istribution to @ (15%,%%4) ! ! 15%,%%4 ! !

Postliquidation

balances !0! !0! !0! !0! !0! !0! !0! !


18/19

82

Chapter 4

Pa!+*$!)'

Sc$d.#$ ", /')+!'b.+'"* ", P$!)"*a# A))$+)

.*$ 30 2008

: K G B

Personal assets, eJcludin' partners/ip capital and loan interests 500,000 600,000 #00,000

Personal liabilities (460,000) (480,000) (650,000)

Personal net 3ort/, eJcludin' partners/ip capital and loan interests 40,000 120,000 50,000

Contribution to partners/ip (1%,%%4)

;istribution fro- partners/ip 15%,%%4 !0! ! !0! !

Personal capacit 1+%,%%4 106,666 !0! !


19/19

advanced accounting chapter 4

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