1.
On January 1, 20x1, A, B and C formed a partnership with original capital contribution ratio of
[Link] for total agreed capitalization of P5,000,000. The profit or loss ratio agreement provides that profits
shall be distributed in the ratio of [Link] while losses shall be distributed in the ratio of [Link]. During 20x1,
the partnership reported net income of P2,000,000 with A and B withdrawing P500,000 and P300,000,
respectively. During 20x2, the partnership reported net loss of P1,000,000 with B and C withdrawing
P200,000 and P400,000 respectively.
What is the capital balance of B on December 31, 20x2?
а. P2,600,000
b. P2,300,000
c. P2,500,000
d. P2,400,000
2. On January 1, 20x1, K, L and M formed a partnership with respective capital contribution of
P2,000,000, P5,000,000 and P3,000,000. The articles of co-partnership provides that profit or loss shall be
distributed accordingly:
> 20% interest on original capital contribution.
> P30,000 monthly salary for K and P50,000 monthly salary for M.
> The remainder shall be distributed on the basis of original capital contribution ratio.
On December 31, 20x1, K and L made withdrawals of P500,000 and P1,000,000, respectively. The
statement of financial position of the partnership shows that L's capital on December 31, 20x1 is
P6,500,000.
What is the capital balance of K on December 31, 20x1?
a. P3,260,000
b. P2,100,000
c. P2,360,000
d. P2,860,000
3. On January 1, 20x7, K and S formed KS Partnership organized to train prospective professional
accountants. The articles of co-partnership provides that profit or loss shall be distributed accordingly:
> 10% interest on average capital balance.
> P50,000 and P100,000 quarterly salary for K and S, respectively.
> The remainder shall be distributed in the ratio of 3:2 for K and S, respectively.
> The following transactions regarding the capital balance of the partners for year 20x7 are
provided:
K, Capital S, Capital
January 1, 20x7 investment P1,000,000 P500,000
March 31, 20x7 investment 100,000
July 1, 20x7 withdrawal 200,000
September 30, 20x7 withdrawal 200,000
October 1, 20x7 investment 700,000
The chief account of the partnership reported net income of P1,000,000 for year 20x7.
What is the capital balance of Klay on December 31, 20x7?
a. P1,951,500
b. P1,451,500
c. P2,151,500
d. P1,251,500
4. On July 1, 20x8, D and J formed DJ Partnership with initial investment of P1M and P2M,
respectively. D is appointed as the managing partner. The articles of co-partnership provides that profit or
loss shall be distributed accordingly:
> 30% interest on original capital contribution ratio.
> Monthly salary of P20,000 and P10,000 respectively for D and J.
> D shall be entitled to bonus equivalent to 20% of net income after interest, salary and bonus.
> The remainder shall be distributed in ratio of 3:2 for D and J respectively.
For the year ended December 31, 20x8, the partnership reported net income of P750,000.
What is the share in net income of D for the year ended December 31, 20x8?
a. P400,000
b. P250,000
c. P350,000
d. P500,000
5. Using the same data in number 4, what is the share in net income of J assuming (bonus is
equivalent to 20% of net income after interest and salary but before bonus for year ended
December 31, 20x8?
a. P351,600
b. P398,400
c. P350,000
d. P500,000
6. A, B, and C are engaged in a merchandising business. Their capital accounts in the ABC
Partnership in 20x5 are as follows:
A B C
January 1 100,000 150,000 120,000
April 1, withdrawal 5,000
May 1, investment 10,000 15,000
August 1, investment 15,000
December 1, withdrawal 6,500 30,000
The partners agreed on the following terms: 8% interest on their average capital balances. Quarterly
salaries of P75,000, P55,000, P68,000 for them respectively. Bonus is given to B, 5% of income before
tax after his interest, his salary, and bonus. For the year ended, the partnership has a credit balance in the
income summary account of P550,000. The relevant tax rate during the year is 20%. The remainder will
be divided in the ratio [Link].
1. How much is the share of partner B in the net Income?
A. 158,251
B. 155,971
C. 151,286
D. 153,532
2. How much is the capital balance of partner A at December 31, 20x5?
A. 352,743
B. 353,824
C. 350,732
D. 351,867
7. M, N, and O are partners sharing profits and losses. The combined salaries of M and O is
P175,000 while the combined salaries of M and N is P165,000. The partners paid total interest of P33,500
of which M and O received P21,700 in total which is 2,600 less than what M and N received combined.
Since M is the managing partner, he receives a bonus of P10,500. The partners share the remainder in the
ratio
[Link]. Partner O's share in. remainder is P10,400. Partner N received a share in the net income of
P105,900.
1. How much is the share in the net income received by partner M?
A. 108,350
B. 109,350
C. 109,500
D. 108,500
2. How much is the total net income of the partnership?
A. 350,000
B. 330,000
С. 345,000
D. 355,000
3. How much is the monthly salaries of the partners?
A. M: 20,000; N: 21,250; O: 23,750
B. M: 16,000; N: 17,000; O: 19,000
C. M: 7,272; N: 7,727; O: 8,636
D. M: 6,667; N: 7,083; O: 7,917
8. L and R are partners. Their capital accounts during 20x10 were as follows:
L, Capital R, Capital
8/23 P6,000 1/1 P30,000 3/5 P9,000 1/1 P50,000
4/3 8,000 7/6 7,000
10/31 6,000 10/7 5,000
Partnership net income is P50,000 for the year. The partnership agreement provides for the division of net
income as follows:
> Each partner is credited 10% interest on average capital
> Because of prior work experience, L is entitled to an annual salary of P12,000 and R is credited
with 8,000.
How much of the partnership net income for 20x10 should be assigned to L and R?
a. L, 23,666; R, 26,334
b. L, 18,750; R, 31,250
c. L, 26,388; R, 23,612
d. L, 25,000; R, 25,000
9. D, E, F and G operate as a partnership with capital contributions of P50,000, P25,000, P25,000
and P20,000 to D, E, F and G each, respectively. The partnership agreement includes the following:
> Partners shall receive 5% interest in the amounts of their capital contributions.
> D is to receive a salary of P5,000 and E a salary of P3,000.
> The partners are to share in losses in the ratio of [Link] to D, E, F and G each respectively.
If E’s share in the net income for the year amounts to P5,000 , determine the net income of the
partnership for the year.
a. 17,600
b. 17,750
c. 17,000
d. 18,400
