ABC, a sole proprietor, agreed to form a partnership with EFG in a business. Accounts in the ledger for ABC on September 30, 2021, just before the formation show the following balances: P 26,000 120,000 180,000 Accounts Payable АВС, Саpital P 62,000 264,000 Cash Accounts Receivable Merchandise Inventory It is agreed that for purposes of establishing ABCS interest, the following adjustments should be made: An allowance for doubtful accounts of 2% of accounts receivable is to be established. The merchandise inventory is to be valued at P202,000. Prepaid expenses of P6,500 and accrued liabilities of P4,000 are to be established. EFG is to invest sufficient funds in order to receive a 1/3 interest in the partnership. 4. How much must EFG contribute?
ABC, a sole proprietor, agreed to form a partnership with EFG in a business. Accounts in the ledger for ABC on September 30, 2021, just before the formation show the following balances: P 26,000 120,000 180,000 Accounts Payable АВС, Саpital P 62,000 264,000 Cash Accounts Receivable Merchandise Inventory It is agreed that for purposes of establishing ABCS interest, the following adjustments should be made: An allowance for doubtful accounts of 2% of accounts receivable is to be established. The merchandise inventory is to be valued at P202,000. Prepaid expenses of P6,500 and accrued liabilities of P4,000 are to be established. EFG is to invest sufficient funds in order to receive a 1/3 interest in the partnership. 4. How much must EFG contribute?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:ABC, a sole proprietor, agreed to form a partnership with EFG in a business. Accounts in the ledger for ABC
on September 30, 2021, just before the formation show the following balances:
P 26,000
120,000
180,000
Accounts Payable
АВС, Саpital
P 62,000
264,000
Cash
Accounts Receivable
Merchandise Inventory
It is agreed that for purposes of establishing ABCS interest, the following adjustments should be made:
An allowance for doubtful accounts of 2% of accounts receivable is to be established.
The merchandise inventory is to be valued at P202,000.
Prepaid expenses of P6,500 and accrued liabilities of P4,000 are to be established.
EFG is to invest sufficient funds in order to receive a 1/3 interest in the partnership.
How much must EFG contribute?
4.
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