1. Assuming there is no separate records maintained, compute for the Joint Operation Account of Small, before distributing net income.2. Assuming there is no separate records maintained, compute for the profit after management fee and bonus.3. Assuming there is no separate records maintained, compute for cash settlement for Large.4. Assuming there is separate records maintained for the joint operation, compute for the Joint Operation Account of Medium, before distributing net income.5. Assuming there is separate records maintained for the joint operation, compute for the cash settlement for Medium. Accounting for Joint Operation TransactionsSmall, Medium and Large formed a joint operation. The followingFact pattern:Conall, Medium and Large formed a joint operation. The followingwere the joint operation transactions:Small transferred cash of P100,000 to Large, the appointedmanager, representing Small's contribution.Medium contributed inventories worth P120,000.c Large contributed cash of P80,000.d. Large purchased inventories worth P160,000 and paid freightof P20,000 using the cash contributions.e. Large made cash sales of P900,000.f. Large paid expenses of P240,000 from the JO-Cash.a.• All inventories were sold except one-third from Large'spurchases. Large was charged for the cost of the unsoldinventory.• The joint operators agreed on the following:i.Large is entitled to à management fee of P6,000 and abonus of 15% of profit after management fee and bonus.Any remaining profit or loss is divided equally.ii.

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FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

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1. Assuming there is no separate records maintained, compute for the Joint Operation Account of Small, before distributing net income.

2. Assuming there is no separate records maintained, compute for the profit after management fee and bonus.

3. Assuming there is no separate records maintained, compute for cash settlement for Large.

4. Assuming there is separate records maintained for the joint operation, compute for the Joint Operation Account of Medium, before distributing net income.

5. Assuming there is separate records maintained for the joint operation, compute for the cash settlement for Medium.

Accounting for Joint Operation Transactions
Small, Medium and Large formed a joint operation. The following
Fact pattern:
Conall, Medium and Large formed a joint operation. The following
were the joint operation transactions:
Small transferred cash of P100,000 to Large, the appointed
manager, representing Small's contribution.
Medium contributed inventories worth P120,000.
c Large contributed cash of P80,000.
d. Large purchased inventories worth P160,000 and paid freight
of P20,000 using the cash contributions.
e. Large made cash sales of P900,000.
f. Large paid expenses of P240,000 from the JO-Cash.
a.
• All inventories were sold except one-third from Large's
purchases. Large was charged for the cost of the unsold
inventory.
• The joint operators agreed on the following:
i.
Large is entitled to à management fee of P6,000 and a
bonus of 15% of profit after management fee and bonus.
Any remaining profit or loss is divided equally.
ii.

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