On October 01, 2019, Benny and Joey pooled their resources in a partnership with the firm taking over their business assets and assuming their business liabilities. They agreed to make the following adjustments and to make settlement among themselves to conform to the 40:60 capital and profit and loss ratio. ➢ Joey’s inventory be reduced by P3,000. ➢ Allowance for doubtful accounts be recognized in the amount of P1,500 each. ➢ P4,000 of unrecorded accounts payable to supplier be recorded in the books of Benny ➢ Accrued utilities be recognized in the books of Benny, P1,200. ➢ Store equipment in the books of Joey are under depreciated by P5,000. The individual trial balance before adjustments show the following:BennyJoey AssetsP120,000P150,000 Liabilities 25,000 35,000 Capital 95,000 115,000 The capital balances of the partners that conform with their agreement are: Benny: ___________________Joey: _____________________
On October 01, 2019, Benny and Joey pooled their resources in a partnership with the firm taking over their business assets and assuming their business liabilities. They agreed to make the following adjustments and to make settlement among themselves to conform to the 40:60 capital and profit and loss ratio. ➢ Joey’s inventory be reduced by P3,000. ➢ Allowance for doubtful accounts be recognized in the amount of P1,500 each. ➢ P4,000 of unrecorded accounts payable to supplier be recorded in the books of Benny ➢ Accrued utilities be recognized in the books of Benny, P1,200. ➢ Store equipment in the books of Joey are under depreciated by P5,000. The individual trial balance before adjustments show the following:BennyJoey AssetsP120,000P150,000 Liabilities 25,000 35,000 Capital 95,000 115,000 The capital balances of the partners that conform with their agreement are: Benny: ___________________Joey: _____________________
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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On October 01, 2019, Benny and Joey pooled their resources in a partnership with the firm taking over their business assets and assuming their business liabilities. They agreed to make the following adjustments and to make settlement among themselves to conform to the 40:60 capital and profit and loss ratio.
➢ Joey’s inventory be reduced by P3,000.
➢ Allowance for doubtful accounts be recognized in the amount of P1,500 each.
➢ P4,000 of unrecorded accounts payable to supplier be recorded in the books of Benny
➢ Accrued utilities be recognized in the books of Benny, P1,200.
➢ Store equipment in the books of Joey are under depreciated by P5,000.
The individual trial balance before adjustments show the following:
BennyJoey
AssetsP120,000P150,000
Liabilities 25,000 35,000
Capital 95,000 115,000
The capital balances of the partners that conform with their agreement are:
Benny: ___________________Joey: _____________________
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