ADVANCED ACCOUNTING LUPISAN 3A

8/22/2019 ADVANCED ACCOUNTING LUPISAN 3A

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AA1 -Chapter 3 (2008 edition))s page 1

Exercise 3 7

Other Velasco CAPITAL

Cash Assets Liabilities Loan Viola Velasco VicenteBalances before liquidation P 80,000 P960,000 P630,000 P 50,000 P470,000 (P140,000) P30,000Sale of other assets & distribution of loss 200,000 ( 300,000) ( 60,000) ( 20,000) ( 20,000)

Balances P280,000 P660,000 P630,000 P 50,000 P410,000 (P160,000) P10,000Payment of liabilities ( 280,000) ( 280,000)

Balances --- P660,000 P350,000 P 50,000 P410,000 (P160,000) P10,000Offset of loan ( 50,000) 50,000

Additional investment by Velasco 90,000 90,000

Balances P 90,000 P660,000 P350,000 ---- P410,000 (P 20,000) P10,000

Asset distributed to Viola ( 200,000) ( 212,000) 6,000 6,000

Balances P 90,000 P460,000 P350,000 ----- P198,000 (P 14,000) P16,000

July sale of assets and distribution of loss 540,000 ( 400,000) 84,000 28,000 28,000Balances P630,000 P 60,000 P350,000 ----- P282,000 P 14,000 P44,000

Payment of liabilities (350,000) ( 350,000)

Balances P280,000 P 60,000 ------ ---- P282,000 P 14,000 P44,000Possible loss on remaining other assets ( 60,000) ( 36,000) ( 12,000) ( 12,000)

Cash distribution to partners P280,000 ----- ----- ---- P246,000 P 2,000 P32,000


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Chapter 3 Partnership Liquidation

Suggested Answers page

PROBLEMSProblem 3-1

1. Elma, Erica and EdnaStatement of Liquidation

January 1 31, 2008Non-cash C A P I T A L

Cash Assets Liabilities Elma Erica EdnaProfit and loss ratio 3/8 3/8 2/8

Balances before liquidation P 80,000 P810,000 P270,000 P60,000 P290,000 P270,000Sale of non-cash assets and distribution of loss 634,000 (810,000) (66,000) ( 66,000) ( 44,000)

Payment of liquidation expenses ( 24,000) ( 9,000) ( 9,000) ( 6,000)

Balances P690,000 P270,000 (P15,000) P215,000 P220,000Payment of liabilities (270,000) (270,000)

Balances P420,000 (P15,000) P215,000 P220,000Additional investment of Elma 15,000 15,000

Balances P435,000 P215,000 P220,000Payment to partners ( 435,000) ( 215,000) ( 220,000)


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2. Elma , Erica and EdnaStatement of Liquidation

January 1 31, 2008Non-cash Note Payable C A P I T A L

Cash Assets to Elma Liabilities Elma Erica EdnaProfit and loss ratio 3/8 3/8 2/8

Balances before liquidation P 80,000 P810,000 P70,000 P200,000 P60,000 P290,000 P270,000Sale of non-cash assets and distribution of loss 634,000 (810,000) (66,000) ( 66,000) ( 44,000)

Payment of liquidation expenses (24,000) ( 9,000) ( 9,000) ( 6,000)

Balances P690,000 P70,000 P200,000 (P15,000) P215,000 P220,000Payment of liabilities (200,000) (200,000)

Balances P490,000 P70,000 (P15,000) P215,000 P220,000Offset of loan against debit balance in the

capital balance ofElma ( 15,000)

15,000Balances P490,000 P55,000 P215,000 P220,000Payment to partners (490,000) ( 55,000) ( 215,000) ( 220,000)

3. Elma , Erica and EdnaStatement of Liquidation

January 1 31, 2008NR from Non-cash NP C A P I T A L

Cash Erica Assets to Elma Liabilities Elma Erica EdnProfit and loss ratio 3/8 3/8 2/

Balances before liquidation P 80,000 P110,000 P700,000 P70,000 P200,000 P60,000 P290,000 P270

Sale of non-cash assets and distribution of

loss

634,000 (700,000) (24,750) ( 24,750) ( 16

Payment of liquidation expenses (24,000) ( 9,000) ( 9,000) ( 6

Balances P690,000 P110,000 P70,000 P200,000 P26,250 P256,250 P247Payment of liabilities (200,000) (200,000)

Balances P490,000 P110,000 P70,000 P26,250 P256,250 P247Offset of receivable against credit balance in

the capital ofErica (110,000)

( 110,000)

Balances P490,000 P70,000 P26,250 P146,250 P247


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Payment to partners (490,000) ( 70,000) ( 26,250) ( 146,250) ( 247

Problem 3 2 (Case 1)

Calma, Daza and EstebanStatement of Liquidation

January, 2009Other L O A N C A P I T A L

Cash Assets Liabilities Daza Esteban Calma(2/5)

Daza(2/5)

Esteba(1/5)

Balances before liquidation P 20,000 P 340,000 P 112,000 P 5,000 P 8,000 P 95,000 P 60,000 P 80,00Sale of assets & distribution of loss 250,000 (340,000) (36,000) (36,000) (18,00

Balances P 270,000 - P 112,000 P 5,000 P 8,000 P 59,000 P 24,000 P 62,00

Payment of liabilities ( 112,000) (112,000)

Payment of to partners P 158,000 - - P 5,000 P 8,000 P 59,000 P 24,000 P 62,00

Problem 3 2 (Case 2)Calma, Daza and EstebanStatement of Liquidation

January, 2009Other L O A N C A P I T A L

Cash Assets Liabilities Daza Esteban Calma(2/5)

Daza(2/5)

Esteba(1/5)

Balances before liquidation P 20,000 P 340,000 P 112,000 P 5,000 P 8,000 P 95,000 P 60,000 P 80,00Sale of assets & distribution of loss 185,000

(340,000) (62,000) (62,000) (31,00

Balances P 205,000 - P 112,000 P 5,000 P 8,000 P 33,000 P( 2,000) P 49,00Payment of liabilities ( 112,000) (112,000)

Balances P 93,000 - - P 5,000 P 8,000 P 33,000 P( 2,000) P 49,00Offset of loan against debit balance in the

capital account (2,000) 2,000

Payment to partners P 93,000 - - P 3,000 P 8,000 P 33,000 - P 49,00


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Calma, Daza and Esteban

Statement of LiquidationJanuary, 2009

Other L O A N C A P I T A LCash Assets Liabilities Daza Esteban Calma

(2/5)Daza(2/5)

Esteban(1/5)


Balances P 190,000 - P 112,000 P 5,000 P 8,000 P 27,000 P( 8,000) P 46,00Payment of liabilities ( 112,000) (112,000)

Balances P 78,000 - - P 5,000 P 8,000 P 27,000 P( 8,000) P 46,00

Offset of loan against debit balance in thecapital account (5,000)

5,000

Balances P 78,000 - - - P 8,000 P 27,000 P(3,000) P 46,00Payment to partners ( 78,000) ( 8,000) ( 25,000) (45,00

Balances - - - - - P 2,000 P(3,000) P 1,00Additional investment by Daza 3,000 3,000

Payment to partners P 3,000 - - - - P 2,000 - P 1,00


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Problem 3- 2 (Case 4)




(2/5)Daza(2/5)

Esteban(1/5)


Balances P 145,000 - P 112,000 P 5,000 P 8,000 P 9,000 P(26,000) P 37,00Payment of liabilities ( 112,000) (112,000)

Balances P 33,000 - - P 5,000 P 8,000 P 9,000 P(26,000) P 37,00Offset of loan against debit balance in the

capital account (5,000) 5,000

Balances P 33,000 - - - P 8,000 P 9,000 P(21,000) P 37,00Payment to partners ( 33,000) ( 8,000) (25,00

Balances - - - - - P 9,000 P(21,000) P 12,00Additional investment by Daza 21,000 21,000

Payment to partners P 21,000 - - - - P 9,000 - P 12,00


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(2/5)Daza(2/5)

Esteba(1/5)


Balances P 110,000 - P 112,000 P 5,000 P 8,000 P( 5,000) P(40,000) P 30,00Payment of liabilities ( 110,000) (110,000)

Balances - - P 2,000 P 5,000 P 8,000 P( 5,000) P(40,000) P 30,00

Offset of loan against debit balance in thecapital account (5,000) 5,000

Balances - - P 2,000 - P 8,000 P( 5,000) P(35,000) P 30,00Additional investment by Calma and Daza 40,000 5,000 35,000

Payment of liabilities, loan and capital P 40,000 - P 2,000 - P 8,000 - - P 30,00


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Problem 3-4

1. Estrella, Capital P 144,000 3. a. Cash 463,000Estrella, Drawing ( 12,000) Eugenio, Capital 52,500

Total interest of Estrella P 132,000 Esteban, Capital 31,500Cash received by Estrella 111,000 Estrella, Capital 21,000

Share of Estrella in the loss on

liquidation

P 21,000 Other Assets 568,000

Fractional share of Estrella 2/10

Total loss on liquidation P 105,000 b. Liabilities 200,000

Cash 200,000

c. Esteban, Loan 40,000Eugenio, Capital 79,500Esteban, Capital 102,500Estrella, Capital 111,000

Cash 333,000

2.

Eugenio , Esteban and EstrellaStatement of Liquidation

January 1 31, 2008

C A P I T A L

Cash

Other

Assets Liabilities

Esteban,

Loan

Eugenio

(5/10)

Esteban

(3/10)

Estrella

(2/10)Balances before liquidation P 70,000 P 568,000 P 200,000 P 40,000 P 132,000 P 134,000 P132,000Sale of other assets & distribution of loss 463,000 ( 568,000) ( 52,500) ( 31,500) ( 21,000)

Balances P 533,000 P 200,000 P 40,000 P 79,500 P 102,500 P 111,000Payment of liabilities (200,000) ( 200,000)

Balances P 333,000 P 40,000 P 79,500 P 102,500 P 111,000

Payment to partners ( 333,000) ( 40,000) ( 79,500) (102,500) ( 111,000)


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Problem 3 - 6

QRS PartnershipStatement of LiquidationJuly to September, 2008

Accounts Roman, C A P I T A L

Cash Other Assets Payable Loan Quizon Roman Silva

Balances before liquidation P 150,000 P2,010,000 P1,215,000 P150,000 P300,000 P270,000 P225,000

July: Sale of assets 1,170,000 ( 1,530,000) ( 180,000) ( 108,000) ( 72,000)

Payment of liabilities ( 1,215,000) ( 1,215,000)


P 97,500 P 480,000 - P150,000 P116,250 P159,750 P151,500Payment of loan ( 67,500) ( 67,500)

Balances P 30,000 P 480,000 - P 82,500 P116,250 P159,750 P151,500

August: Sale of assets 66,000 ( 105,000) ( 19,500) ( 11,700) ( 7,800)


P 88,500 P 375,000 - P 82,500 P 93,000 P145,800 P142,200

Payment of loan and capital ( 58,500) ( 41,100) ( 17,400)

Balances P 30,000 P 375,000 - P 41,400 P 93,000 P145,800 P124,800

Sept.: Sale of assets 165,000 ( 375,000) ( 105,000) ( 63,000) ( 42,000)


P 187,500 - - P 41,400 (P 15,750) P 80,550 P 81,300

Additional loss to Roman & Silva 15,750 ( 9,450) ( 6,300)

Payment to partners P 187,500 - - P 41,400 - P 71,100 P 75,000


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Problem 3 - 5

JKLM Trading

Statement of LiquidationFebruary 1 - March 31, 2008

Other Jocson C A P I T A Cash Assets Liabilities Loan Jocson Kaimo Legarda Man

Balances before liquidation P 100,320 P 193,530 P 21,360 P 15,000 P 24,120 P 96,480 P 109,020 P 27February:

Sale of assets & distribution of loss 49,320 ( 66,060) ( 3,348) ( 5,022) ( 5,022) ( 3,Payment of liabilities ( 17,750) ( 17,750)Payment of liquidation expenses ( 8,220) ( 1,644) ( 2,466) ( 2,466) ( 1,

Balances P 123,670 P 127,470 P 3,610 P 15,000 P 19,128 P 88,992 P 101,532 P 22Payment to partners (sch. 1) ( 120,060) ( 7,980) (49,770) ( 62,310)

Balances P 3,610 P 127,470 P 3,610 P 7,020 P 19,128 P 39,222 P 39,222 P 22

March:Sale of assets & distribution of gain 48,330 ( 44,850) 696 1,044 1,044 6Payment of liabilities ( 3,610) ( 3,610)Payment of liquidation expenses ( 7,380) ( 1,476) ( 2,214) ( 2,214) ( 1,

Balances P 40,950 P 82,620 p -------- P 7,020 P 18,348 P 38,052 P 38,052 P 22Payment to partners (sch. 2) ( 40,950) 7,020 ( 1,824) (13,266) ( 13,266) ( 5,

Balances, March 31 P --------- P 82,620 P -------- P ------- P 16,524 P 24,786 P 24,786 P 16


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Problem 3 - 8

Req. 2Neri, Ordan and Pacia

Statement of LiquidationJanuary 1 - March 31, 2008

Other Pacia, Sal. Pay. C A P I T A L

Cash Assets Liabilities Loan to Neri Neri Ordan Pacia

Balances before liquidation P 19,000 P 191,000 P 77,000 P 9,000 P 6,000 P 50,000 P 28,000 P 40,000

January:

Collections from customers 112,000 (112,000)


Payment of liabilities ( 38,000) ( 38,000)

Balances P 88,600 P 79,000 P 39,000 P 9,000 P 6,000 P 47,800 P 26,900 P 38,900

Payment to partners (see schedule) ( 16,000) ( 9,000) ( 7,000)

Balances P 72,600 P 79,000 P 39,000 - P 6,000 P 47,800 P 26,900 P 31,900

February:

Collections from customers 36,000 ( 36,000)

Payment of liquidation expenses ( 2,800) ( 1,400) ( 700) ( 700)

Payment of liabilities & dist. of gain (38,000) ( 39,000) 500 250 250

Balances P 67,800 P 43,000 - - P 6,000 P 46,900 P 26,450 P 31,450

Payment to partners (see schedule) ( 19,800) ( 6,000) ( 1,400) ( 3,700) ( 8,700)

Balances P 48,000 P 43,000 - - - P 45,500 P 22,750 P 22,750

March:

Collections from customers & dist. of

loss

35,000 ( 43,000) ( 4,000) ( 2,000) ( 2,000)


Payment to partners P( 79,000) - - - - P 39,500 P 19,750 P 19,750


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Problem 3 -8

Requirement No 1 Neri, Ordan and Pacia

Cash Priority ProgramJanuary 1, 2008

Neri Ordan Pacia Neri Ordan PacCapital balances before liquidation P 50,000 P 28,000 P 40,000Add Loan balances 6,000 9,000

Total partners interest P 56,000 P 28,000 P 49,000Profit and loss ratio 50% 25% 25%

Loss absorption balance P112,000 P112,000 P196,000allocation I - Cash to Pacia reducing LAB to an amount reported

for Neri and Ordan. Reduction of P84,000 requires payment

of 25% of P 84,000 ( 84,000) _______ _______ P 21,0Balances P112,000 P112,000 P112,000 -------- --------- P 21,0Allocation II - Further cash distributions may be made in the profit and loss raio

SCHEDULE OF CASH DISTRIBUTION:Amount Neri Ordan Pacia

January: Cash available P 16,000Allocation I:

Payable to Pacia 16,000 - --------- P 16,000

February: Cash available P 19,800

Allocation I:Payable to Pacia 5,000 P 5,000

Allocation IIPayable according

to P & L ratio P 14,800 P 7,400 P 3,700 3,700

- P 7,400 P 3,700 P 8,700


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Problem 3 - 7

Requirement 3

Tabora, Ureta and VelosoStatement of Liquidation

January 1 to April 30, 2008

Other L O A N C A P I T A LCash Assets Tabora Ureta Veloso Tabora Ureta Veloso

Balances before liquidation - P 338,000 P 45,000 P 30,000 P 13,000 P 120,000 P 90,000 P 40,000January:

Sale of assets 15,000 ( 15,000)Payment to partners (15,000) (15,000)

Balances - P 323,000 P 45,000 P15,000 P 13,000 P 120,000 P 90,000 P 40,000

February:Sale of assets 40,000 ( 40,000)Payment to partners ( 40,000) ( 21,250) (15,000) ( 3,750)

Balances P 283,000 P 23,750 - P 13,000 P 120,000 P 86,250 P 40,000March:

Sale of assets 90,000 ( 90,000)Payment to partners ( 90,000) (23,750) (13,000) ( 23,500) ( 28,350) ( 1,400)

Balances - P 193,000 - - - P 96,500 P 57,900 P 38,600April:

Sale of assets & distribution of loss 30,000 ( 193,000) ( 81,500) ( 48,900) (32,600)

Balances P 30,000 - - - - P 15,000 P 9,000 P 6,000

Payment to partners (30,000) - - - - P 15,000 P 9,000 P 6,000


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ADVANCED ACCOUNTING LUPISAN 3A

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