Question

Xerath, Yu Zhong and Zac who divided profits and losses 50%, 30% and 20% respectively, have the following October 31, 2019 account balances: Xerath, drawing (dr) Zac, drawing (Cr) Accounts Payable - Xerath Loans Payable - Yu Zhong Xerath, Capital Yu Zhong, Capital Zac, Capital P 18,000 7,200 10,800 21,600 89,100 66,600 58,500

The partnership’s asset are P316,800 including cash of P96,300. The partnership is liquidated and Zac receives P49,500 in final settlement.

14. How much is the total loss on realization?

a. P81,000

b. P9,000

c. P45,000

d. P108,000

15. How much was received by Xerath upon liquidation?

a. P71,100

b. P66,600

c. P30,600

d. P48,600

Answer 1

Answer of question no 14:-

Total loss on realization is P9,000

Answer of question no 15:-

The amount received by Xerath upon liqudation is P66,600

The details of working for this answers are attached below:-

A B D E F H 1 1 2 3 4 Partners Capital Account Xerath Yu Zhong Zac Xerath By Balance 18000 7200 bt 89100 Yu Zhong Zac 5 To Drawing 66600 58500 6 7 To Realization 4500 1800 B To Cash 56600 89100 2700 633900 66600 49500 58500 9 89100 66600 58500 10 11 Since Zac hold 20% share of this firm then the Total loss on realization will be calculated as follows:- 12 58500 *Calculation of loss of realization - Balance of Zac Capital account Less:Drawings Less:Final settlement Loss on realization 13 -7200 -49500 Zac's share on totalid 1800 Zac's share 20% Total Loss 1800x100/20 9000 15 1800 16 17 Xerath share 50% 18 Xerath share of loss 9000x50% 4500 19 Amount received by Xerath on liquidation Balance of capital account 89100 Less Drawings -18000 Less Loss on realization 4500 Final amount received upon liquidation 66600 20 Yu zhong share 30% 21 Yu zhong share of id 9000x30% 2700 22 23 24 25 26 27 28 29 30