Reference no: EM132668131

Questions -

Q1. Patrice, Bella and Timmy were partners with capital balances on January 2, 2019 of P175,000; P262,500 and P350,000, respectively. Their profit ratio is 5:3:2 while their capital interest ratio is 4:4:2. On July 1, 2019, Jade was admitted by the partnership for 20% interest in capital and 25% in profits by contributing P43,750 cash, and the old partners agree to bring their interest to their old capital and profit interest sharing ratio. The partnership had net income of P105,000 before admission of Jade and the partners agree to revalue its overvalued equipment by P17,500. How much is the he capital balance of Patrice after admission of Jade?

A. P148,750

B. P294,000

C. P177,100

D. P235,200

Q2. Lalaine, Erin and Gia are partners with capital balances of P336,000, P540,000 and P190,000 respectively, sharing profits and losses in the ratio of 2:5:1. Selena is admitted as a new partner bringing with him expertise and is to invest cash for a 15% interest in the partnership considering the transfer of capital from him of P90,000 upon his admission. Upon admission of Selena, which of the following statements is wrong?

A. The capital balance of Erin amount to P596,250.

B. Cash will be debited in the amount of P204,000.

C. The capital account of Gia will be credited in the amount of P11,250.

D. The total agreed capital of the old partners is P90,000.