Quelpr
8 marksChanges in Ownership and Capital Structure

CAPE Accounting Unit 1 · 2006 · Paper 2 · Question 2(iii)

B & R Distributors considers admitting Zandolie, who offers cash 10,000, equipment 85,000, and current liabilities $25,000 to acquire a one-third share of the partnership under the bonus method.

Compute the bonus attributable to Bravo and Rampaul upon the admission of Zandolie to the partnership.

The mark scheme is shown once you've answered.

Practise this question

Other parts of this question

  1. 2(i)Prepare the income statement for B & R Distributors for the year ending December 31, 2005, including the appropriation of profits between the partners.[8 marks]
  2. 2(ii)Prepare a statement of changes in the partners' capital for the current year.[3 marks]
  3. 2(iv)Prepare a balance sheet for the partnership immediately following the admission of Zandolie.[12 marks]
  4. 2(v)Briefly discuss TWO advantages and TWO disadvantages that would accrue to B & R Distributors if they changed from a partnership to a public company.[4 marks]

More practice: the rest of this paper · more Changes in Ownership and Capital Structure questions · all CAPE Accounting Unit 1 past papers