For nos. 27 to 30. JULIO COMPANY and AUGUSTO COMPANY are participants in a joint arrangement. sharing control and profits equally. They contributed P500,000 each. JULIO's contribution is cash. AUGUSTO contributed an equipment with a carrying value of P480,000. The equipment has a ten-year remaining life when contributed. They established APRIL MAY CORPORATION on January 2, 2023 to carry on the joint undertaking, thus JULIO AND AUGUSTO have equal rights over the net assets of the business. The following information is relevant in answering the various questions: Net income during the year Cash dividends paid during the year Retained earnings, 1/1/23 JULIO CO. 72,000 18,000 100,000 a. a debit to Cash in JO of P250,000 b. a debit to Equipment in JO of P240,000 c. a credit to gain on sale of P20,000 d. a credit to gain on sale of P10,000 AUGUSTO CO. 80,000 24,000 70,000 APRILMAY CO. 144,000 36,000 PO 27. How much total amount of asset(s) will AUGUSTO COMPANY recognize on January 2, 2023 to record its investment? 28. At what amount will the investment of AUGUSTO COMPANY be shown in its December 31, 2023 balance sheet? 29. At what amount will JULIO COMPANY report its Retained Earnings at December 31, 2023? 30. The journal entry AUGUSTO COMPANY will record its investment on January 2, 2023 will include
For nos. 27 to 30. JULIO COMPANY and AUGUSTO COMPANY are participants in a joint arrangement. sharing control and profits equally. They contributed P500,000 each. JULIO's contribution is cash. AUGUSTO contributed an equipment with a carrying value of P480,000. The equipment has a ten-year remaining life when contributed. They established APRIL MAY CORPORATION on January 2, 2023 to carry on the joint undertaking, thus JULIO AND AUGUSTO have equal rights over the net assets of the business. The following information is relevant in answering the various questions: Net income during the year Cash dividends paid during the year Retained earnings, 1/1/23 JULIO CO. 72,000 18,000 100,000 a. a debit to Cash in JO of P250,000 b. a debit to Equipment in JO of P240,000 c. a credit to gain on sale of P20,000 d. a credit to gain on sale of P10,000 AUGUSTO CO. 80,000 24,000 70,000 APRILMAY CO. 144,000 36,000 PO 27. How much total amount of asset(s) will AUGUSTO COMPANY recognize on January 2, 2023 to record its investment? 28. At what amount will the investment of AUGUSTO COMPANY be shown in its December 31, 2023 balance sheet? 29. At what amount will JULIO COMPANY report its Retained Earnings at December 31, 2023? 30. The journal entry AUGUSTO COMPANY will record its investment on January 2, 2023 will include
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:For nos. 27 to 30. JULIO COMPANY and AUGUSTO COMPANY are participants in a joint arrangement
sharing control and profits equally. They contributed P500,000 each. JULIO's contribution is cash.
AUGUSTO contributed an equipment with a carrying value of P480,000. The equipment has a ten-year
remaining life when contributed. They established APRIL MAY CORPORATION on January 2, 2023 to carry
on the joint undertaking, thus JULIO AND AUGUSTO have equal rights over the net assets of the business.
The following information is relevant in answering the various questions:
Net income during the year
Cash dividends paid during the year
Retained earnings, 1/1/23
JULIO CO.
72,000
18,000
100,000
AUGUSTO CO.
a. a debit to Cash in JO of P250,000
b. a debit to Equipment in JO of P240,000
c. a credit to gain on sale of P20,000
d. a credit to gain on sale of P10,000
80,000
24,000
70,000
APRILMAY CO.
144,000
36,000
PO
27. How much total amount of asset(s) will AUGUSTO COMPANY recognize on January 2, 2023 to record
its investment?
28. At what amount will the investment of AUGUSTO COMPANY be shown in its December 31, 2023
balance sheet?
29. At what amount will JULIO COMPANY report its Retained Earnings at December 31, 2023?
30. The journal entry AUGUSTO COMPANY will record its investment on January 2, 2023 will include
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