CC admits DD as a partner in business. Accounts in the ledger for CC on November 30, 20x4, just before the admission of DD, show the following balances: Cash... P 6,800 Accounts Receivable... 14,200 Merchandise Inventory.. 20,000 Accounts Payable. . 8,000 CC, Capital... 33,000 It is agreed that for the purposes of establishing CC's interest the following adjustments shall be made: 1. An allowance for doubtful accounts of 3% of account receivable is to be established. 2. The merchandise inventory is to be valued at P23,000. 3. Prepaid salary expenses of P600 and accrued rent expense of P800 are to be recognized.
CC admits DD as a partner in business. Accounts in the ledger for CC on November 30, 20x4, just before the admission of DD, show the following balances: Cash... P 6,800 Accounts Receivable... 14,200 Merchandise Inventory.. 20,000 Accounts Payable. . 8,000 CC, Capital... 33,000 It is agreed that for the purposes of establishing CC's interest the following adjustments shall be made: 1. An allowance for doubtful accounts of 3% of account receivable is to be established. 2. The merchandise inventory is to be valued at P23,000. 3. Prepaid salary expenses of P600 and accrued rent expense of P800 are to be recognized.
Century 21 Accounting Multicolumn Journal
11th Edition
ISBN:9781337679503
Author:Gilbertson
Publisher:Gilbertson
Chapter23: Accounting For Partnerships
Section: Chapter Questions
Problem 3AP
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Transcribed Image Text:CC admits DD as a partner in business. Accounts in the ledger for CC
on November 30, 20x4, just before the admission of DD, show the
following balances:
Cash....
P 6,800
Accounts Receivable...
14,200
Merchandise Inventory...
20,000
Accounts Payable.. .
8,000
CC, Capital...
33,000
It is agreed that for the purposes of establishing CC's interest the
following adjustments shall be made:
1. An allowance for doubtful accounts of 3% of account receivable is
to be established.
2. The merchandise inventory is to be valued at P23,000.
3. Prepaid salary expenses of P600 and accrued rent expense of
P800 are to be recognized.
1 DD ic to invest sufficient cash to obtain a 1/3 interest in the
Transcribed Image Text:öf establishing CC's interest the
following adjustments shall be made:
1. An allowance for doubtful accounts of 3% of account receivable is
to be established.
2. The merchandise inventory is to be valued at P23,000.
3. Prepaid salary expenses of P600 and accrued rent expense of
P800 are to be recognized.
4. DD is to invest sufficient cash to obtain a 1/3 interest in the
partnership.
CC's adjusted capital before the admission of CC:
O P36,374
O P28,174
O P35,347
O P35,374
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