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in partnership business with Michael Auditor. The Statement of Financial Position of John Mark Cadua who has been in business for a quite long time has decided to venture Cadua prior to the inception of the partnership revealed the folļowing balances P 85,000 60,000 Cash Accounts Receivable Allowance for Doubtful Accounts 4,000 120,000 150,000 30,000 80,000 Merchandise Equipment Acc. Depreciation-Equipment Accounts Payable J. Cadua, Capital As agreed, Auditor will contribute cash equal to one-half (1/2) of the capital balance. Cadua after taking into account the following adjustments: a. The allowance for doubtful accounts is over set-up by P3,000. b. Merchandise should be valued at P105,000 due to obsolescence. c. The equipment is under depreciated by P15,000. d. Accounts Payable was overstated by P4,000 due to recording of an expense. Reguired.

in partnership business with Michael Auditor. The Statement of Financial Position of John Mark Cadua who has been in business for a quite long time has decided to venture Cadua prior to the inception of the partnership revealed the folļowing balances P 85,000 60,000 Cash Accounts Receivable Allowance for Doubtful Accounts 4,000 120,000 150,000 30,000 80,000 Merchandise Equipment Acc. Depreciation-Equipment Accounts Payable J. Cadua, Capital As agreed, Auditor will contribute cash equal to one-half (1/2) of the capital balance. Cadua after taking into account the following adjustments: a. The allowance for doubtful accounts is over set-up by P3,000. b. Merchandise should be valued at P105,000 due to obsolescence. c. The equipment is under depreciated by P15,000. d. Accounts Payable was overstated by P4,000 due to recording of an expense. Reguired.

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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Need the continuation of answers for numbers 4-5.
John Mark Cadua who has been in business for a quite long time has decided to venture in partnership business with Michael Auditor. The Statement of Financial Position of Cadua prior to the inception of the partnership revealed the folļowing balances Cash P 85,000 Accounts Receivable 60,000 4,000 120,000 150,000 30,000 80,000 Allowance for Doubtful Accounts Merchandise Equipment Acc. Depreciation-Equipment Accounts Payable J. Cadua, Capital As agreed, Auditor will contribute cash equal to one-half (1/2) of the capital balance ei Cadua after taking into account the following adjustments: a. The allowance for doubtful accounts is over set-up by P3,000. b. Merchandise should be valued at P105,000 due to obsolescence. c. The equipment is under depreciated by P15,000. d. Accounts Payable was overstated by P4,000 due to recording of an expense. Required: 1. Compute the capital account balance of Cadua prior to partnership formation.
Transcribed Image Text:John Mark Cadua who has been in business for a quite long time has decided to venture in partnership business with Michael Auditor. The Statement of Financial Position of Cadua prior to the inception of the partnership revealed the folļowing balances Cash P 85,000 Accounts Receivable 60,000 4,000 120,000 150,000 30,000 80,000 Allowance for Doubtful Accounts Merchandise Equipment Acc. Depreciation-Equipment Accounts Payable J. Cadua, Capital As agreed, Auditor will contribute cash equal to one-half (1/2) of the capital balance ei Cadua after taking into account the following adjustments: a. The allowance for doubtful accounts is over set-up by P3,000. b. Merchandise should be valued at P105,000 due to obsolescence. c. The equipment is under depreciated by P15,000. d. Accounts Payable was overstated by P4,000 due to recording of an expense. Required: 1. Compute the capital account balance of Cadua prior to partnership formation.
Partnership - Nature and Formation . Prepare the necessary adjusting entries in the book of Cadua by directly effecting his capital account. 3. Prepare a journal entry to close the book of Cadua. 4. Prepare a journal entry to open the book of the partnership. This will record the contribution of Cadua and Auditor. 5. Prepare a Statement of Financial Position after the partnership formation.
Transcribed Image Text:Partnership - Nature and Formation . Prepare the necessary adjusting entries in the book of Cadua by directly effecting his capital account. 3. Prepare a journal entry to close the book of Cadua. 4. Prepare a journal entry to open the book of the partnership. This will record the contribution of Cadua and Auditor. 5. Prepare a Statement of Financial Position after the partnership formation.
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