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he picture attached here is the problem.    Choose the correct LETTER of answer: What is the net (debit) credit amount of adjustment for Darren and Daryl? a. P50,000              P50,000 b. P(50,000)            P(50,000)  c. P(14,000)            P(35,000) d. P14,000              P35,000 e. None of the above   What is the amount of total assets after the formation? a. P1,900,000 b. P1,800,000 c. P1,700,000 d. P1,600,000 e. none of the above

he picture attached here is the problem.    Choose the correct LETTER of answer: What is the net (debit) credit amount of adjustment for Darren and Daryl? a. P50,000              P50,000 b. P(50,000)            P(50,000)  c. P(14,000)            P(35,000) d. P14,000              P35,000 e. None of the above   What is the amount of total assets after the formation? a. P1,900,000 b. P1,800,000 c. P1,700,000 d. P1,600,000 e. none of the above

FINANCIAL ACCOUNTING
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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The picture attached here is the problem. 

 

Choose the correct LETTER of answer:

  • What is the net (debit) credit amount of adjustment for Darren and Daryl?

a. P50,000              P50,000

b. P(50,000)            P(50,000) 

c. P(14,000)            P(35,000)

d. P14,000              P35,000

e. None of the above

 

  • What is the amount of total assets after the formation?

a. P1,900,000

b. P1,800,000

c. P1,700,000

d. P1,600,000

e. none of the above

Op September 1, 20xx, Darren and Darryl agreed to combine their businesses and form a partnership. Their respective Post-Closing Trial Balance as at August 31, 20xx show the following: Darren Darryl Debit Credit Debit Credit Cash 250,000.00 400,000.00 175,000.00 Accounts Receivable 300,000.00 200,000.00 10,000.00 35,000.00 Inventories 300,000.00 Prepaid Expenses Furniture and Fixtures, net 5,000.00 50,000.00 Office Equipment, net Accounts Payable Owner's Equity 45,000.00 30,000.00 300,000.00 200,000.00 550,000.00 750,000.00 750,000.00 1,050,000.00 1,050,000.00 750,000.00 They agreed to have the following adjustments in their books: a. Provide 3% allowance for doubtful accounts based on Accounts Receivable. b. The fair market values of inventory amounted to: Darren P282,000 P179,000 Darryl Darren's furniture and fixturés should be P40,000, while Darryl's office equipment is under-depreciated by P5,000. C. d. Rent expense incurred previously by Darren was not yet recorded amounting to P10,000, while salary expense incurred by Darryl was not also recorded amounting to P15,000. e. Profits and losses shall be distributed according to their capital ratio. 55
Transcribed Image Text:Op September 1, 20xx, Darren and Darryl agreed to combine their businesses and form a partnership. Their respective Post-Closing Trial Balance as at August 31, 20xx show the following: Darren Darryl Debit Credit Debit Credit Cash 250,000.00 400,000.00 175,000.00 Accounts Receivable 300,000.00 200,000.00 10,000.00 35,000.00 Inventories 300,000.00 Prepaid Expenses Furniture and Fixtures, net 5,000.00 50,000.00 Office Equipment, net Accounts Payable Owner's Equity 45,000.00 30,000.00 300,000.00 200,000.00 550,000.00 750,000.00 750,000.00 1,050,000.00 1,050,000.00 750,000.00 They agreed to have the following adjustments in their books: a. Provide 3% allowance for doubtful accounts based on Accounts Receivable. b. The fair market values of inventory amounted to: Darren P282,000 P179,000 Darryl Darren's furniture and fixturés should be P40,000, while Darryl's office equipment is under-depreciated by P5,000. C. d. Rent expense incurred previously by Darren was not yet recorded amounting to P10,000, while salary expense incurred by Darryl was not also recorded amounting to P15,000. e. Profits and losses shall be distributed according to their capital ratio. 55
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