The following transactions occurred in the formation of Enercon Service Makers partnership: 1. Perez made a cash investment of P500,000. 2. Tiu invested equipment costing P800,000 with a current market value of P700,000 with an outstanding mortgage of P200,000 with ABC bank. The partnership will assume the mortgage. 3. Ruiz will be admitted as the manager with 20% share in the profit. 4. The partnership earned service fee of P400,000 and paid operating expenses totaling P150,000. 5. Perez and Tiu withdrew P 20,000 each while Ruiz was paid salary of P30,000. Required: a. Prepare journal entries to record the above transactions b. Prepare the Statement of Partners' Equity; the Net Income is to be divided as follows: 20% to Ruiz and the Balance divided equally between Perez & Tiu.

The following transactions occurred in the formation of Enercon Service Makers partnership: 1. Perez made a cash investment of P500,000. 2. Tiu invested equipment costing P800,000 with a current market value of P700,000 with an outstanding mortgage of P200,000 with ABC bank. The partnership will assume the mortgage. 3. Ruiz will be admitted as the manager with 20% share in the profit. 4. The partnership earned service fee of P400,000 and paid operating expenses totaling P150,000. 5. Perez and Tiu withdrew P 20,000 each while Ruiz was paid salary of P30,000. Required: a. Prepare journal entries to record the above transactions b. Prepare the Statement of Partners' Equity; the Net Income is to be divided as follows: 20% to Ruiz and the Balance divided equally between Perez & Tiu.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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