80. Mary and Jane agreed to form a partnership. Balance sheet accounts of Mary just before the formation show: Cash, P26,000, Accounts receivable, PI20,000, Merchandise inventory, PI80,000, and Accounts payable, P62,000. It' was agreed that for purposes of establishing Mary's interest, the following adjustments be made: 1.) an allowance for doubtful accounts of 3% of accounts receivable is to be established; 2.) merchandise inventory is to be adjusted upward by P25,000; and 3.) prepaid expenses of P3,600 and accrued liabilities of P4,000 are to be recognized. If Jane is to invest sufficient cash to obtain 2/5 interest in the partnership, how much would Jane contribute to the new partnership? * O A. P176,000 B. P190,000 O C. P95,000 D. P113,980
80. Mary and Jane agreed to form a partnership. Balance sheet accounts of Mary just before the formation show: Cash, P26,000, Accounts receivable, PI20,000, Merchandise inventory, PI80,000, and Accounts payable, P62,000. It' was agreed that for purposes of establishing Mary's interest, the following adjustments be made: 1.) an allowance for doubtful accounts of 3% of accounts receivable is to be established; 2.) merchandise inventory is to be adjusted upward by P25,000; and 3.) prepaid expenses of P3,600 and accrued liabilities of P4,000 are to be recognized. If Jane is to invest sufficient cash to obtain 2/5 interest in the partnership, how much would Jane contribute to the new partnership? * O A. P176,000 B. P190,000 O C. P95,000 D. P113,980
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:80. Mary and Jane agreed to form a
partnership. Balance sheet accounts
of Mary just before the formation
show: Cash, P26,000, Accounts
receivable, PI20,000, Merchandise
inventory, PI80,000, and Accounts
payable, P62,000. It' was agreed that
for purposes of establishing Mary's
interest, the following adjustments be
made: 1.) an allowance for doubtful
accounts of 3% of accounts
receivable is to be established; 2.)
merchandise inventory is to be
adjusted upward by P25,000; and 3.)
prepaid expenses of P3,600 and
accrued liabilities of P4,000 are to be
recognized. If Jane is to invest
sufficient cash to obtain 2/5 interest in
the partnership, how much would
Jane contribute to the new
partnership? *
O A. P176,000
B. P190,000
O C. P95,000
O D. P113,980
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