Jennifer has been very successful in operating her business for the last five years. Her financial statements showed total assets of P380,000 and liabilities of P30,000. She invited Nicole to join her by investing an amount enough to give her a 40% interest in the firm. Profit and loss agreement provides 60:40 to Jennifer and Nicole, respectively. Before the formation, the parties agreed to make the following adjustments in the books of Jennifer: ➢ Allowance for doubtful accounts amounting to P5,000 be established. ➢ The merchandise should be adjusted to include goods out on consignment amounting to P20,000. ➢ Accrued utilities be recognized, P5,000. The amount to be invested by Nicole is

Jennifer has been very successful in operating her business for the last five years. Her financial statements showed total assets of P380,000 and liabilities of P30,000. She invited Nicole to join her by investing an amount enough to give her a 40% interest in the firm. Profit and loss agreement provides 60:40 to Jennifer and Nicole, respectively. Before the formation, the parties agreed to make the following adjustments in the books of Jennifer: ➢ Allowance for doubtful accounts amounting to P5,000 be established. ➢ The merchandise should be adjusted to include goods out on consignment amounting to P20,000. ➢ Accrued utilities be recognized, P5,000. The amount to be invested by Nicole is

CONCEPTS IN FED.TAX.,2020-W/ACCESS

20th Edition

ISBN:9780357110362

Author:Murphy

Publisher:Murphy

Chapter3: Income Sources

Section: Chapter Questions

Problem 79P

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Jennifer has been very successful in operating her business for the last five years. Her financial statements showed total assets of P380,000 and liabilities of P30,000. She invited Nicole to join her by investing an amount enough to give her a 40% interest in the firm. Profit and loss agreement provides 60:40 to Jennifer and Nicole, respectively. Before the formation, the parties agreed to make the following adjustments in the books of Jennifer: > Allowance for doubtful accounts amounting to P5,000 be established. > The merchandise should be adjusted to include goods out on consignment amounting to P20,000. > Accrued utilities be recognized, P5,000. The amount to be invested by Nicole is
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The following information was obtained from the records of BV Suppliers, a partnership business with Betty and Valerie, on 29 February 2020 (the end of the financial year): Betty's capital balance was 29 February 2020 was R500 000. She increased her capital contribution by R100 000 on 01 September 2019 (and this was recorded). She earns interest at a rate of 12% per annum. Which one of the following reflects her interest on capital for the year ended 29 February 2020? O A. R66 000 O B. R60 000 OC. R48 000 O D. R54 000
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