GOD BLESS POSTDATED CPAs!! ^^
You’ve worked so hard to graduate and review for the board exam. PRAY. You can do it! =D
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Matching. Not planned.. But still awesome. #greatmindsthinkalike @JosephMorgan and I this am at Upfronts
”So, I guess we are who we are for alot of reasons. And maybe we’ll never know most of them. But even if we don’t have the power to choose where we come from, we can still choose where we go from there. We can still do things. And we can try to feel okay about them.”
(Source: padfootmagic, via iamnumberf4or)
PAHINGING SMARTLOAD /m\
COMPREHENSIVE REVIEWR IN PARTNERSHIP AND CORPORATION
Part I. (2 points each) Choose the letter of the best answer.
1. Partners Gang and Nam received an interest allowance of P100,000 and P150,000 respectively, divided the remaining profits and losses in a 3:1 ratio. If the company sustained a loss of P110,000 during the year, what is the effect on Gang’s capital?
A. P105,000 decrease C. P120,000 decrease
B. P82,500 decrease D. P170,000 decrease
2. A partner who contributes money or property as well as his work or industry to the capital of the partnership is called
A. Industrial partner C. Managing partner
B. Capitalist partner D. Capitalist-industrial partner
3. Five persons decide to organize a corporation. Which of the following situation illustrates best the minimum requirement of the law to capital formation?
Authorized Capital Subscribed Capital Paid-in Capital
A. P100,000 P20,000 P5,000
B. 100,000 25,000 5,000
C. 100,000 25,000 6,250
D. 100,000 30,000 6,000
4. The amount of the shareholders’ investment is called
A.Paid-in Capital C. Retained Earnings
B. Outstanding share D. Total shareholders’ equity
5. When ordinary shares are sold on a subscription basis and the entire subscription price has been collected, the issuance of the share is recorded by
A. Dr Cash; Cr Ordinary Shares
B. Dr Subs. Receivable; Cr Subscribed Ord. Shs.
C. Dr Ord. Shares; Cr Subs. Receivable
D. Dr Subscribed Ord. Shs.; Cr Ord Shs.
6. How would the declaration of a 15% share dividend by a corporation affect each of the following?
A. Retained Ear.-No effect; Total SHE-No effect
B. Retained Ear.-Decrease; Total SHE-No effect
C. Retained Ear.-No effect; Total SHE-Decrease
D. Retained Ear.-Decrease; Total SHE-Decrease
Part II. (5 points each) Provide the best answer.
1. Chris invested in a partnership a parcel of land which cost his father P200,000. The land had a market value of P300,000 when James inherited it 3 years ago. Currently, the land is independently appraised at P500,000 even though James insisted that he “wouldn’t take P900,000 for it.” The land should be recorded in the accounts of the partnership at _________
2. On Mar. 1 2012 Gang and Nam formed a partnership with each contributing the following assets:
Gang Nam
Cash P30,000 P70,000
Machinery and Equipment 25,000 75,000
Building 125,000
Furniture and Fixtures 10,000
The building is subject to mortgage loan of P80,000 which is to be assumed by the partnership. Agreement provides that Gang and Nam share profits and losses 30% and 70% respectively. On Mar. 1 2012, what should be the balance in Nam’s capital account?
3. Psy had a P500,000 capital balance for 8 months and a P650,000 balance for 4 months. Oppa had a P380,000 capital balance for 5 months and a P500,000 balance for 7 months. How much of the year’s P800,000 profit should Psy receive if profits and losses are distributed based on the ratio of the average capital balances?
Charles and Tine are partners in a business. Charles’ original capital investment was P400,000 and Tine’s was P600,000. They agreed to share profits and losses as follows:
Charles Tine
Salaries P120,000 P180,000
Interest on original capital 10% 10%
Remaining profits and losses 3/5 2/5
4. If loss for the year was P100,000, what is the share of Charles in the partnership profit?
5. If profit for the year was P150,000, what is the share of Tine in the partnership profit?
Partners Oppa, Gang and Nam have capital balances in a partnership of P150,000, P100,000 and P200,000 respectively. Loss for the year was P330,000.
6. What will be Gang’s capital balance if Oppa gets an P180,000 salary, Gang gets a P70,000 salary and Nam gets 10% interest on his beginning balance with the remainder being divided at a 2:2:1 ratio?
7. Apo and Tau are partners who share profits and losses in a ratio of 3:2 respectively, and have the following capital balances on Dec. 31,2012: Apo, Capital P2,000,000 Cr.; Tau, Capital P1,500,000 Cr.. Assume that the partners agreed to let Gamma into the partnership by investing P1,000,000 for a ¼ interest. How much will Apo’s capital balance be?
8. As of Dec. 31, 2012, the books of Bueno partnership showed capital balances of A, P40,000; B, P25,000; and C, P5,000. The partner’s profit and loss ratio was 3:2:1, respectively. The partners decided to liquidate and they sold all non-cash assets for P37,000. After settlement of liabilities amounting to P12,000, they still have cash of P28,000 lest for distribution. Assuming that any capital deficiency is uncollectible, what would be the share of A in the distribution of cash?
9. Enit Corp.’s shareholder’s equity accounts at Dec. 31, 2012 were as follows:
Ordinary shares, P20 par P8,000,000
Share Premium 2,550,000
Retained Earnings 1,275,000
All ordinary shares outstanding at Dec. 31, 2012 were issued in 2011 for P26 a share. On Jan. 4, 2013, Enit re-acquired 20,000 of its ordinary shares at P24 a share and retired them. Immediately after the shares were retired, what was the balance in share premium?
10. On Dec. 1, 2012, Emson Corp. received donation of 2,000 shares of its P50 par value ordinary shares from a shareholder. On that date, the share’s market value was P350 per share. The stock was originally issued for P250 per share. By what amount would this donation cause total shareholders’ equity to decrease?
“A creative man is motivated by the desire to achieve, not by the desire to beat others.”
-Ayn Rand
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