1. Day and Night contributed the following in forming a partnership business: Day 280,000 Night Cash Accounts receivable 100,000 Inventory 160,000 Building (at carrying amount) 760,000 Total 540,000 760,000 Additional information: Only 60% of the accounts receivable is recoverable. The net realizable value of the inventory is P120,000. Day acquired the inventory on account; the partnership will assume the unpaid balance of P60,000. The building has a fair value of P900,000. Requirement: Provide the journal entry.
1. Day and Night contributed the following in forming a partnership business: Day 280,000 Night Cash Accounts receivable 100,000 Inventory 160,000 Building (at carrying amount) 760,000 Total 540,000 760,000 Additional information: Only 60% of the accounts receivable is recoverable. The net realizable value of the inventory is P120,000. Day acquired the inventory on account; the partnership will assume the unpaid balance of P60,000. The building has a fair value of P900,000. Requirement: Provide the journal entry.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:1. Day and Night contributed the following in forming a
partnership business:
Day
Night
Cash
280,000
Accounts receivable
100,000
Inventory
Building (at carrying amount)
160,000
760,000
Total
540,000
760,000
Additional information:
Only 60% of the accounts receivable is recoverable.
The net realizable value of the inventory is P120,000. Day
acquired the inventory on account; the partnership will
assume the unpaid balance of P60,000.
The building has a fair value of P900,000.
Requirement: Provide the journal entry.
3. Use the information in problem 1. Day and Night agreed to have
equal credits to their capital accounts. The bonus method shall
be used.
Requirements:
Provide the compound journal entry.
b. Provide the simple journal entries.
а.
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