Ratio, Percentage, Decimal PDF

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ILLUSTRATIVE EXAMPLES...

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Ratio, Percentage, Decimal Exercise 4 Abad, Bayaca and Cacabelos are partners in ABC Co. The capital account of each partner are as follows: Abad, Capital Jan. 1 Beginning Balance Aug. 30 Nov. 1

Debit

Bayaca, Capital Jan. 1 Beginning Balance Sep. 30 Nov. 30

Debit

Cacabelos, Capital Jan. 1 Beginning Balance Aug. 30 Nov. 1

Debit

Credit

Balance 500,000 500,000 1,000,000

Credit

Balance 750,000 250,000 500,000

Credit

Balance 1,250,000 750,000

500,000

The partners agreed that the profit will be distributed in the following independent cases. A. Profit of P750,000 will be distributed in the following ratio respectively: 1. 6:8:10 Solution: 6 + 8 + 10 = 24 therefore (6/24,8/24,10/24) Abad 6/24 = 0.25 = 25% Bayaca 8/24= 0.33 = 33% Cacabelos 10/24 =0.42 = 42% Abad (750,000 x 25%) = P187,500 Bayaca (750,000 x 33%) = P247,500 Cacabelos (750000 X 42 %) = P315,000 2. 3:5:2 Solution: 3 + 5 + 2 = 10 therefore (3/10,5/10,2/10) Abad 3/10 = 0.3 = 30% Bayaca 5/10= 0.5 = 50% Cacabelos 2/10 =0.2 = 20% Abad (750,000 x 30%) = P225,000 Bayaca (750,000 x 50%) = P375,000 Cacabelos (750000 X 20 %) = P150,000 3. 4:2:4 Solution: 4 + 2 + 4 = 10 therefore (4/10,2/10,4/10) Abad 4/10 = 0.4 = 40%

Bayaca 2/10= 0.2 = 20% Cacabelos 4/10 =0.4 = 40% Abad (750,000 x 40%) = P300,000 Bayaca (750,000 x 20%) = P150,000 Cacabelos (750000 X 42 %) = P300,000 4. 9:5:6 Solution: 9 + 5 + 6 = 20 therefore (9/20,5/20,6/20) Abad 9/20 = 0.45 = 45% Bayaca 5/20= 0.25 = 25% Cacabelos 6/20 =0.3 = 30% Abad (750,000 x 45%) = P337,500 Bayaca (750,000 x 25%) = P187,500 Cacabelos (750000 X 30%) = P225000 5. 7:2:5 Solution: 7 + 2 + 5 = 14 therefore (7/14,2/14,5/14) Abad 7/14 = 0.5 = 50% Bayaca 2/14= 0.14 = 14% Cacabelos 5/14 =0.36 = 36% Abad (750,000 x 50%) = P375,000 Bayaca (750,000 x 14%) = P105,000 Cacabelos (750000 X 36%) = P270,000 B. Profit of 1,500,000 is distributed based on: 1. Beginning Capital Ratio Ratio of beginning Capital Balances (500,000:750,000:1,250,000) = 2,500,000 Abad (1,500,000 X 500,000/2,500,000) = (1,500,000 x 0.2) =P300,000 Bayaca (1,500,000 X 750,000/2,500,000) = (1,500,000 x 0.3) = P450,000 Cacabelos (1,500,000 X 1,250,000/2,500,000) = (1,500,000 x 0.5) =P750,000 2. Ending Capital Ratio Capital balances additional investments Aug. 30 Additional investments sept. 1 Additional investments Nov. 1 Additional investments Nov. 30 Withdrawal Nov. 1 Capital Balances December 31

Abad 500,000 500,000 -1,000,000 --2,000,000

Bayaca 750,000 -250,000` -500,000 -1,500,000

Cacabelos 1,250,000 750,000 ---(500,000) 1,500,000

Ratio of Ending Capital Balances (2,000,000:1,500,000:1,500,000) = 5,000,000 Abad (1,500,000 X 2,000,000/5,000,000) = (1,500,000 x 0.4) =P600,000 Bayaca (1,500,000 X 1,500,000/5,000,000) = (1,500,000 x 0.3) = P450,000 Cacabelos (1,500,000 X 1,500,000/5,000,000) = (1,500,000 x 0.3) =P450,000

3. Weighted Average Capital Ratio Date 1-1 8-30 11-1

Capital balance

Date 1-1 9-1 11-30

Capital balance

Date 1-1 8-30 11-1

Capital balance

Average Capital of Abad No.of Mos. Until year-end 500,000 12/12 500,000 4/12 1,000,000 2/12 Capital Average

Peso Equivalent 500,000.00 166,667.67 166,666.67 833,333.34

Average Capital of Bayaca No.of Mos. Until year-end 750,000 12/12 250,000 4/12 500,000 1/12 Capital Average

Peso Equivalent 750,000.00 83,333.33 41,666.67 875,000.00

Average Capital of Cacabelos No.of Mos. Until year-end 1,250,000 12/12 750,000 4/12 (500,000) 2/12 Capital Average

Peso Equivalent 1,250,000.00 250,000.00 (83,333.33) 1,416,666.67

Ratio of Weighted Capital Balance (833,333.34:875,000:1,416,666.67) = 3,125,000.01 Abad (1,500,000 x 833,333.34/3,125,000.01) = (1,500,000 x 0.27) = 405,000 Bayaca (1,500,000 x 875,000/3,125,000.01) = (1,500,000 x 0.28) = 420,000 Cacabelos (1,500,000 x 1,416,666.67/3,125,000.01) = (1,500,000 x 0.45) = 675,000 Exercise 5 Acio, Bautista and Castillo are partners in ABC Co. The capital account of each partner are as follows: Acio, Capital Jan. 1 Beginning Balance Aug. 30 Nov. 1

Debit

Bautista, Capital Jan. 1 Beginning Balance Sept. 30 Nov. 30

Debit

Castillo, Capital Jan. 1 Beginning Balance Aug. 30 Nov. 1

Debit

Credit

Balance 1,500,000

500,000 750,000 Credit

Balance 750,000 250,000

500,000 Credit

Balance 1,000,000 750,000 500,000

The partners agreed that the profit will be distributed in the following independent cases.

C. Profit of P1,750,000 will be distributed in the following ratio respectively: 6. 6:8:5 Solution: 6 + 8 + 5 = 19 therefore (6/19,8/19,5/19) Acio 6/19 = 0.32 = 32% Bautista 8/19= 0.42 = 42% Castillo 5/19 =0.26 = 26% Acio Bautista Castillo

(1,750,000 x 32%) = P560,000 (1,750,000 x 42%) = P735,000 (1,750,000 X 26%) = P455,000

7. 3:5:7 Solution: 3 + 5 + 7 = 15 therefore (3/15,3/15,7/15) Acio 3/15 = 0.2 = 20% Bautista 5/15= 0.33 = 33% Castillo 7/15 =0.47 = 47% Acio Bautista Castillo

(1,750,000 x 20%) = P350,000 (1,750,000 x 33%) = P577,500 (1,750,000 X 47%) = P822,500

8. 4:2:4 Solution: 4 + 2 + 4 = 10 therefore (4/10,2/10,4/10) Acio 4/10 = 0.4 = 40% Bautista 2/10= 0.2 = 20% Castillo 4/10 =0.4 = 40% Acio Bautista Castillo

(1,750,000 x 40%) = P700,000 (1,750,000 x 20%) = P350,000 (1,750,000 X 40%) = P700,000

9. 9:5:6 Solution: 9 + 5 + 6 = 20 therefore (9/20,5/20,6/20) Acio 9/20 = 0.45 = 45% Bautista 5/20= 0.25 = 25% Castillo 6/20 =0.3 = 30% Acio Bautista Castillo

(1,750,000 x 45%) = P787,500 (1,750,000 x 25%) = P437,500 (1,750,000 X 30%) = P525,000

10. 2:5:3 Solution: 2 + 5 + 3 = 10 therefore (2/10,5/10,3/10)

Abad 2/10 = 0.2 = 20% Bayaca 5/10= 0.5 = 50% Cacabelos 3/10 =0.3 = 30% Abad (1,750,000 x 20%) = P350,000 Bayaca (1,750,000 x 50%) = P875,000 Cacabelos (1,750,000 X 30%) = P525,000 D. Profit of 2,500,000 is distributed based on: 4. Beginning Capital Ratio Ratio of beginning Capital Balances (1,500,000:750,000:1,000,000) = 3,250,000 Abad (2,500,000 X 1,500,000/3,250,000) = (2,500,000 x 0.46) =P1,150,000 Bayaca (2,500,000 X 750,000/3,350,000) = (2,500,000 x 0.23) = P575,000 Cacabelos (2,500,000 X 1,000,000/3,250,000) = (1,500,000 x 0.31) =P775,000 5. Ending Capital Ratio Capital balances additional investments Aug. 30 Additional investments sept. 1 Additional investments Nov. 1 Withdrawal Aug. 30 Withdrawal Nov. 30 Capital Balances December 31

Acio 1,500,000 --750,000 (500,000) -1,750,000

Bautista 750,000 -250,000` --(500,000) 500,000

Castillo 1,000,000 750,000 -500,000 -2,250,000

Ratio of Ending Capital Balances (1,750,000:500,000:2,250,000) = 4,500,000 Acio (2,500,000 X 1,750,000/4,500,000) = (2,500,000 x 0.39) =P975,000 Bautista (2,500,000 X 500,000/4,500,000) = (2,500,000 x 0.11) = P275,000 Castillo (2,500,000 X 2,250,000/4,500,000) = (2,500,000 x 0.5) =P1,250,000 6. Weighted Average Capital Ratio Date 1-1 8-30 11-1

Capital balance

Date 1-1 9-1 11-30

Capital balance

Date 1-1 8-30

Capital balance

Average Capital of Acio No.of Mos. Until year-end 1,500,000 12/12 (500,000) 4/12 750,000 2/12 Capital Average

Peso Equivalent 1,500,000.00 (166,666.67) 125,000.00 1,458,333.33

Average Capital of Bautista No.of Mos. Until year-end 750,000 12/12 250,000 4/12 (500,000) 1/12 Capital Average

Peso Equivalent 750,000.00 83,333.33 (41,666.67) 791,666.66

Average Capital of Castillo No.of Mos. Until year-end 1,000,000 12/12 750,000 4/12

Peso Equivalent 1,000,000.00 250,000.00

11-1

500,000

2/12 Capital Average

83,333.33 3,583,333.33

Ratio of Weighted Capital Balance (1,458,333.33:791,666.66:3,583,333.33) = 5,833,333.32 Acio (2,500,000 x 1,458,333.33/5,833,333.32) = (2,500,000 x 0.25) = 625,000 Bautista (2,500,000 x 791,666.66/5,833,333.32) = (2,500,000 x 0.14) = 350,000 Castillo (2,500,000 x 3,583,333.33/5,833,333.32) = (2,500,000 x 0.61) = 1,525,000...