ABC and XYZ establish a joint arrangement using a separate vehicle. The legal formof the separate vehicle does not confer separation between the parties and theseparate vehicle. The contractual terms of the joint arrangement provide for thefollowing:• ABC has rights to all of the equipment of the separate vehicle• XYZ shall have 60% rights to the building of the separate vehicle• ABC has the obligation to the accounts payable of the separate vehicle• The other items are shared by the parties on a 50:50 ratioThe separate vehicle provided the following statement of financial position:AssetsLiabilities and EquityCashP 500,000 ACcounts payable P1,800,000Building - net3,000,000 Notes payable1,500,000Equipment - net2,000,000 Equity2,200,000TotalP5,500,000 TotalP5,500,0001. How much of the total assets of the separate vehicle would be presented in theseparate statement of financial position of ABC?2. How much of the total assets of the separate vehicle would be presented in theseparate statement of financial position of XYZ?3. How much of the total liabilities of the separate vehicle would be presented inthe separate statement of financial position of ABC?4. How much of the total liabilities of the separate vehicle would be presented inthe separate statement of financial position of ABC?

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ABC and XYZ establish a joint arrangement using a separate vehicle. The legal forn of the separate vehicle does not confer separation between the parties and the separate vehicle. The contractual terms of the joint arrangement provide for the following: • ABC has rights to all of the equipment of the separate vehicle • XYZ shall have 60% rights to the building of the separate vehicle • ABC has the obligation to the accounts payable of the separate vehicle • The other items are shared by the parties on a 50:50 ratio

ABC and XYZ establish a joint arrangement using a separate vehicle. The legal forn of the separate vehicle does not confer separation between the parties and the separate vehicle. The contractual terms of the joint arrangement provide for the following: • ABC has rights to all of the equipment of the separate vehicle • XYZ shall have 60% rights to the building of the separate vehicle • ABC has the obligation to the accounts payable of the separate vehicle • The other items are shared by the parties on a 50:50 ratio

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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