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REQUIRED: Give the correcting compound entry.

REQUIRED: Give the correcting compound entry.

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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3.10 Partners A and B share profits 3:1 after annual salary allowances of P 4,000 and P 6,000, respectively. If profits are not adequate to meet the salary allowances, the entire profit is to be divided using the salary ratio. The net profit reported during the year amounted to P 9,000. The following year, prior to the closing of the books, It was ascertained that the net income for the previous year did not reflect the overstatement in depreciation by P 3,600 and an understatement in the ending inventory by P 800. REQUIRED: Give the correcting compound entry.
Transcribed Image Text:3.10 Partners A and B share profits 3:1 after annual salary allowances of P 4,000 and P 6,000, respectively. If profits are not adequate to meet the salary allowances, the entire profit is to be divided using the salary ratio. The net profit reported during the year amounted to P 9,000. The following year, prior to the closing of the books, It was ascertained that the net income for the previous year did not reflect the overstatement in depreciation by P 3,600 and an understatement in the ending inventory by P 800. REQUIRED: Give the correcting compound entry.
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