Partnership Formation_1

On September 1, 2015 VENTUS and FLAMMA decided to form a partnership.  Their balance sheets on this date are:

    VENTUS                FLAMMA

Cash                                        P    15,000                   P  37,500

Accounts receivable                    540,000                     225,000

Merchandise Inventory                     -                           202,500

Furniture and Fixtures (net)        150,000                     270,000

Accounts payable                    P 135,000                    P 240,000

Ventus, capital                            570,000                   

Flamma, capital                                                              495,000

They agreed to provide 10% provision for doubtful accounts of their accounts receivables.  Furniture and Fixtures of VENTUS is over depreciated by 11,500 and that of FLAMMA by P 21,000.  The partnership agreement provides for a profit and loss ratio and capital interest of 40%  to VENTUS and 60% to FLAMMA. 

Required: Compute the additional cash to be invested by FLAMMA to bring the partners’ capital balances proportionate to their profit and loss ratio.

Note:  Please email your answer at:  timoleon.lianza@gmail.com