18 Pepe and Pilar are partners having capital balances of P 35,000 and P 25,000, respectively. They share profits in the ratio of 6:4. Juan is to invest sufficient cash to give him a 40% interest in the new capital, which is proportionate to his share in the earnings. The old partners will share in the balance of the earnings using their original profit sharing ratio. REQUIRED: a. Give the entry to record the admission of Juan. b. Show the interest of each partner (expressed as a percentage) in the total capital before and after the admission of Juan. c. What is the new profit and loss sharing ratio? ONKED

18 Pepe and Pilar are partners having capital balances of P 35,000 and P 25,000, respectively. They share profits in the ratio of 6:4. Juan is to invest sufficient cash to give him a 40% interest in the new capital, which is proportionate to his share in the earnings. The old partners will share in the balance of the earnings using their original profit sharing ratio. REQUIRED: a. Give the entry to record the admission of Juan. b. Show the interest of each partner (expressed as a percentage) in the total capital before and after the admission of Juan. c. What is the new profit and loss sharing ratio? ONKED

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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