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Hi tutor! Partnerships problem

Forums › FIA Forums › FA2 Maintaining Financial Records Forums › Hi tutor! Partnerships problem

  • This topic has 5 replies, 4 voices, and was last updated 4 years ago by Ken Garrett.
Viewing 6 posts - 1 through 6 (of 6 total)
  • Author
    Posts
  • December 4, 2015 at 10:37 am #287493
    ungleangyeak
    Member
    • Topics: 1
    • Replies: 1
    • ☆

    Luka and Eden have been in partnership, sharing profits and losses equally.
    Greg was admitted to the partnership on 1 December 2012. At that date Luka and Eden each had
    a credit balance of $22,000 on their capital accounts. It was agreed that:
    (1) Goodwill, which would not be carried in the books of the new partnership, had a value of $42,000.
    (2) Profits and losses in the new partnership would be shared between Luka, Eden and Greg in the ratio 2:2:1.
    (3) Greg would introduce cash so that, immediately following his admission, the capital account balances of all three partners were equal.
    How much cash was Greg required to introduce?
    A $34,600
    B $17,800
    C $30,400
    D $26,200

    December 5, 2015 at 9:58 am #287778
    Ken Garrett
    Keymaster
    • Topics: 10
    • Replies: 10194
    • ☆☆☆☆☆

    What are your thoughts on the problem?

    For the goodwill adjustment: Cr Old partners with their share of goodwill in the old profit sharing ratio then DR all partners, including the new one, with their share of goodwill in the new PSR.

    June 13, 2016 at 2:35 pm #322746
    pdevi
    Member
    • Topics: 0
    • Replies: 1
    • ☆

    A) 34600

    Luka/Eden- will be same for both
    22000
    +42000/2
    = 43000 – (2/5 *42000)
    =43000- 16800
    =26,200

    however greg’s share to pay is 1/5 *42000= 84000
    The question is what value when $8400 is subtracted gives 26200?
    x- 8400=26200
    =26200+8400
    x= 34600

    June 13, 2016 at 8:06 pm #322797
    Ken Garrett
    Keymaster
    • Topics: 10
    • Replies: 10194
    • ☆☆☆☆☆

    Looks spot on to me!

    December 28, 2018 at 6:52 pm #499415
    quanghuy99
    Member
    • Topics: 0
    • Replies: 1
    • ☆

    Malik and Vasha are in partnership. The partnership agreement provides for interest on capital to be paid at a rate of 11% per annum. You have the following information: Malik $ Vasha $ Capital balance at 1 November 2010 38,500 47,800 Capital introduced on 1 April 2011 6,000 3,000 What is the total value of interest on capital for the year to 31 October 2011? A $9,905.50 B $10,483.00 C $9,493.00 D $10,070.50

    December 30, 2018 at 3:31 pm #499497
    Ken Garrett
    Keymaster
    • Topics: 10
    • Replies: 10194
    • ☆☆☆☆☆

    (38500+47800) x 11% = 9493

    (6000 + 3000) x 11% x 7/12 = 577.5

    Total = 10,070.5

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