EXERCISE 4-1 EXERCISE 4-2

1 1 1
2 0 2
3 1 3
4 1 4
5 1 5
6 1 6
7 0 7
8 0 8
9 1 9
10 1 10
 EXERCISE 4-2 EXERCISE 4-3
Dissolution 1 D
Liquidation 2 C
Capital Adjustment 3 C
Contributed Capital 4 B
Fraction of Interest 5 B
Total Agreed Capital 6 D
Bonus 7 C
Legal heirs or Representatives of the deceased partner 8 C
Total Contributed Capital 9 A
Percentage Interest 10 B
 EXERC
Montecasino Genera

1,200,000 x 1/2= 630,000

540,000 x 20% = 108,000

150,000 - 108,000 = 42,000
The remaining 42,000 will be treated as personal gain of Scholastica.

Benedict
Capital Balances 1,260,000
Less interest sold to Odilo
1,260,000 x 30% 378,000
540,000 x 30%
Capital After Admission 882,000

Benedict
Capital Balances 1,260,000
Less interest sold to Odilo
1,260,000 x 1/4 315,000
540,000 x 1/4
Capital After Admission 945,000

Benedict
Capital Balances 1,260,000
Add: Upward asset revaluation (30,000-20,000)
10,000 x 7/10 7,000
10,000 x 3/10
Capital Balances after asset revaluation 1,267,000
Less: Interest sold to Odilo
1,267,000 x 25% 316,750
543,000 x 25%
Capital Balances After Admission 950,250
 EXERCISE 4-4
Montecasino General Services Company
DATE PARTICULARS
A. Benedict, Capital
Odlilo, Capital
Admission of new partner by purchase of interest from old partner.

B. Scholastica, Capital
Odilo, Capital
Admission of new partner by purchase of interest from old partner.

Scholastic C. Benedict, Capital

540,000 Scholastica, Capital
Odilo, Capital
Admission of new partner by purchase of interest from old partner.
162,000
378,000

Scholastic D. Benedict, Capital

540,000 Scholastica, Capital
Odilo, Capital
Admission of new partner by purchase of interest from old partner.
135,000
405,000

Scholastic E. Benedict, Capital

540,000 Scholastica, Capital
Odilo, Capital
Admission of new partner by purchase of interest from old partner.
3,000
543,000

135,750
407,250
PR DEBIT CREDIT
630,000
630,000

108,000
108,000

378,000
162,000
540,000

315,000
135,000
450,000

316,750
135,750
452,500
 ACTIVITY 4-5
DATE
400,000 x 1/4 = 100,000 A.
200,000 x 1/4 = 50,000

Michael = 400,000 B.
Rafael = 200,000
Gabriel = 200,000
TCC/TAC = 800,000
800,000 x 25% = 200,000
600,000/80%=750,000 C.
750,000 x 20% = 150,000

Michael Capital 400,000 x 1/3 = 133,333 D.

Rafael Capital 200,000 x 1/3 = 66,667
 ACTIVITY 4-5
PARTICULARS PR DEBIT
MIchael, Capital 100,000
Rafael, Capital 50,000
Gabriel, Capital
Admission of new partner by purchase of interest from old partner.

Cash 200,000
Gabriel, Capital
To record Gabriel's investment.

Cash 150,000
Gabriel, Capital
To record Gabriel's investment.

Micheal, Capital 133,333

Rafael, Capital 66,667
Gabriel, Capital
Admission of the new partner.
CREDIT

150,000

200,000

150,000

200,000
 EXERCISE 4-6
Step 1 Francis 800,000 Step 5
Charles 400,000
Philipp 500,000
TCC 1,700,000

Step 2 TAC = 1,700,000

Step 3 Philipp's investment (CC) 500,000 Step 6

Philipp's (AC) (TAC x interest)
1,700,000 x 25% 425,000
Bonus to Old partners 75,000

Answer to A. Step 7
Step 4 DEBIT CREDIT
Cash 500,000
Philipp, Capital 425,000
Francis, Capital 50,000
Charles, Capital 25,000
CISE 4-6
Partners CC AC Bonus
Francis 800,000 850,000 50,000
Charles 400,000 425,000 25,000
Philipp 500,000 425,000 -75,000
TCC/TAC 1,700,000 1,700,000
Answer to B.

Francis Charles Philipp

Capital Balances 800,000 400,000 500,000
Add: Bonus to old partners 50,000 25,000 -75,000
Capital Balances after admission 850,000 425,000 425,000

Old P&L New P&L

Francis 66.7% or 2/3 x75% or 3/4 50% or 1/2
Charles 33.3% or 1/3 x75% or 3/4 25% or 1/4
Philipp 25% or 1/4
TCC/TAC 100% 100% Answer to C.
 EXERCISE 4-7
Step 1 Maffy 700,000
Luz 300,000
Rose 500,000
TCC 1,500,000

Step 2 TAC = 1,500,000

Step 3 Rose's Investment (CC) 500,000

Rose's (AC) (TAC x interest)
1,500,000 x 40% 600,000
Bonus to New Partner 100,000

Step 4 Answer to A. DEBIT CREDIT

Cash 500,000
Maffy, Capital 70,000
Luz, Capital 30,000
Rose, Capital 600,000
EXERCISE 4-7
Step 5 Partners CC AC Bonus
Maffy 700,000 630,000 -70,000
Luz 300,000 270,000 -30,000
Rose 500,000 600,000 100,000
TCC/TAC 1,500,000 1,500,000
Answer to B.

Step 6 Maffy Luz Rose

Capital Balances 700,000 300,000 500,000
Add: Bonus to Old Partners -70,000 -30,000 100,000
Capital Balances after admission 630,000 270,000 600,000

Step 7 Old P&L New P&L

Maffy 70% x 60% 42%
Luz 30% x 60% 18%
Rose 40%
TCC/TAC 100% 100% Answer to C.
 EXERCISE 4-8
300,000 + 100,000 + 200,000 = 600,000
600,000/80% = 750,000
75,000 x 20% = 150,000
 EXERCISE 4-9
Jude 600,000 Anthony Investment 100,000
Isidore 200,000 Anthony AC
Anthony 100,000 900,000 x 20% 180,000
TCC/TAC 900,000 Bonus to New Partner 80,000

CC AC
Jude 600,000 552,000 -48,000
Isidore 200,000 168,000 -32,000
Anthony 100,000 180,000 80,000
TCC/TAC 900,000 900,000
 ExERCISE 4-10
Joe 500,000 Milet's Investment 300,000
Efren 200,000 Milet's (AC) (TAC x interest)
Rene 300,000 1,300,000 x 20% 260,000
Milet 300,000 Bonus to Old Partners 40,000
TCC/TAC 1,300,000

CC AC Bonus
Joe 500,000 520,000 20,000
Efren 200,000 208,000 8,000
Rene 300,000 312,000 12,000
Milet 300,000 260,000 -40,000
TCC/TAC 1,300,000 1,300,000

Joe Efren Rene Milet

Capital Balances 500,000 200,000 300,000 300,000
Add: Bonus to old partners 20,000 8,000 12,000 -40,000
Capital Balances 520,000 208,000 312,000 260,000
 EXERCISE 4-11
Distribution of Net Income Clare Agnes
Capital Balance Jan. 1, 2020 150,000 125,000
Add: Net Income 45,000 45,000
Capital Balance at the end of 2020 195,000 170,000

Clare 195,000 Bernadette's Investment 175,000

Agnes 170,000 Bernadette's (AC)
Bernadette 175,000 540,000 x 20% 108,000
TCC/TAC 540,000 Bonus to Old Partners 67,000

CC AC Bonus
Clare 195,000 228,000 33,500
Agnes 170,000 203,500 33,500
Bernadette 175,000 108,000 -67,000
TCC/TAC 540,000 540,000

Capital Balance 195,000

Add: Bonus 33,500
Capital Balance of Clare 228,500
 EXERCISE 4-12
800,000 + 400,000 = 1,200,000
1,200,000/80% = 1,500,000
1,500,000 x 1/4 = 375,000 Luke's cash investment

OLD NEW
Timothy 60% x 75% 45%
Paul 40% x 75% 30%
Luke 25%
TCC/TAC 100% 100%
 EXERCISE 4-13

580,000 - 400,000 = 180,000 Journal Entry

DATE PARTICULARS
Mary 180,000 x 4/9 = 80,000 Catherine, Capital
Therese 180,000 x 3/9 = 60,000 Mary, Capital
Anne 180,000 x 2/9 = 40,000 Therese, Capital
Anne, Capital
Cash
To record withdrawal of Catherine
urnal Entry
PR DEBIT CREDIT
400,000
80,000
60,000
40,000
580,000
 EXERCISE 4-14
Yza, Capital 90,000
Add: Bonus from Hazel
5,000 x 3/5 3,000
Yza, Capital after withdrawal 93,000
 EXERCISE 4-15
DATE PARTICULARS PR DEBIT
A. Land 180,000
Joachim, Capital (180,000 x 3/6)
John, Capital (180,000 x 2/6)
Joseph, Capital (180,000 1/6)
To record upward revaluation of asset.

B. John, Capital 200,000

Cash
To record the withdrawal of John.
CREDIT

90,000
60,000
30,000

200,000
 EXERCISE 4-16
DATE PARTICULARS PR DEBIT CREDIT
A. Mark, Capital (120,000 x 4/12) 40,000
Mathew, Capital (120,000 x 4/12) 40,000
James, Capital (120,000 x 4/12) 40,000
Other Assets 120,000
To record the downward revaluation of property and equipment.

B. Mark, Capital (400,000 - 40,000) 360,000

Cash 360,000
To record the withdrawal of Mark