Partnership Formation:

1. On December 1, 2012, EE and FF formed a partnership, agreeing to share for profits and losses in the ratio of 2:3,
respectively. EE invested a parcel of land that cost him P25, 000. FF invested P30, 000 cash. The land was sold for
P50,000 on the same date, three hours after formation of the partnership. How much should the capital balance of EE
right after formation?

A. P25,000 C. P60,000
B. 30,000 D. 50,000

2. On March 1, 2012, II and JJ formed a partnership with each contributing the following assets:

II JJ
Cash P300,000 P700,000
Machinery and Equipment 250,000 750,000
Building -- 2,250,000
Furniture and Fixture 100,000 --

The building is subject to mortgage loan of P800,000, which is to be assumed by the partnership agreement provide
that II and JJ share profits and losses 30% and 70%, respectively. On March 1,2012 balance in JJs capital should be:

A. P3,700,000 C. P3,050,000
B. 3,140,000 D. 2,900,000

3. The same information in Number 2, expect that the mortgage loan is not assumed by the partnership. March 1,2012
the balance in JJs capital account should be:

A. P3,700,000 C. P3,050,000
B. 3,140,000 D. 2,900,000

4. As of July 1,2012, FF and GG decided to form a partnership. Their balance sheets on this date are:

FF GG
Cash P 15,000 P 37,500
Accounts receivable 540,000 225,000
Merchandise Inventory --- 202,500
Machinery and Equipment 150,000 270,000
Total P705,000 P735,000

Account Payable
FF, Capital
GG, Capital

Total