Junior Philippine Institute of Accountants
Student ID no: ______________ Score: _________________
1. Rachael, Sam, and Tan are partners sharing profits in the ratio of 3:3:2. On June 30,
2011 their capital balances are as follows:
On same date, the partners agree to admit Allen on the following agreement:
Allen is to pay Rachael P400,000 for ½ interest of Rachael’s interest.
Allen is also to investment P300,000 in the partnership.
the total capital of the partnership is to be P2,000,000 of which Allen’s interest is to be
What are the capital balances of the partners after the admission of Allen?
Which of the following best describes a possible result of treasury stock transactions
of a corporation?
(a) may directly decrease but not increase retained earnings
(b) may affect stockholders’ equity if the cost method is used instead of the par value
(c) may increase but not decrease reported net earnings
(d) may decrease but not increase reported net earnings
On May 2, 2012, O and P formed a partnership and agreed to share profits and losses
in the ratio of 3:7, respectively. O contributed a parcel of land that cost P10,000. P
contributed P40,000 cash. The land was sold for P18,000 on May 2, 2012, immediately
after the formation of the partnership. What amount should be recorded in O’s capital
account on the formation of the partnership?
The December 31, 2012 the adjusted trial balance of Marzzz Corporation shows the
following balances, among others:
Preferred stock, P100 par
Common stock, P10 par
Common stock dividend payable
Dividends payable – cash
Retained earnings appropriated for plant expansion
Retained earnings unappropriated
Retained earnings appropriated for treasury stock
Retained earnings appropriated for retirement of preferred stock
Treasury common stock, 2,000 shares, at cost
Excess over par – preferred
Excess over par – common
What is the amount of stockholders’ equity on December 31, 2012?