Tom and Jerry form a joint arrangement considered as joint operation with equal interest in the entity. Tom contributed a machine for P1,000,000 and Jery contributed cash amounting P1,000,000.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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1. Which of the following is incorrect? The journal entry of Tom to record his contribution

a. Credit machine amounting to 1,000,000.

b. Credit gain on machine amounting to 500,000.

c. Debit machine in joint operation amounting to 500,000.
d. Debit cash in joint operation amounting to 500,000.
2. Which of the following is incorrect? The journal entry of Jerry to record his contribution. 
a. Debit machine in joint operation amounting to 500,000.
b. Debit cash in joint operation amounting to 500,000.
c. Debit cash in joint operation amounting to 1,000,000
d. Credit cash amounting to 1,000,000.
Tom and Jerry form a joint arrangement considered as joint operation with equal interest in the entity. Tom
contributed a machine for P1,000,000 and Jerny contributed cash amounting P1,000,000.
Transcribed Image Text:Tom and Jerry form a joint arrangement considered as joint operation with equal interest in the entity. Tom contributed a machine for P1,000,000 and Jerny contributed cash amounting P1,000,000.
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