On July 1, 2022, Mr. A and Mr. B agreed to form a partnership business engaged in buying and selling organic rice sourced from South Cotabato to be sold in Davao City. Their contributions included the following: Mr. A Mr. B Cash 250,000.00 380,000.00 Organic rice 180,000.00 Delivery van 1,000,000.00 As agreed, Mr. A's organic rice was revalued at P160,000. The fair value of Mr. B's delivery van is P950,000 on July 1, 2022, and has a mortgage loan balance of P250,000 from the Toyota GenSan branch. Required: 1. Assume the mortgage on the delivery van is treated as Mr. Bs personal obligation: a. Prepare two simple journal entries recording their respective contributions. b. Prepare a Statement of Financial Position as of the date their partnership was formed.

On July 1, 2022, Mr. A and Mr. B agreed to form a partnership business engaged in buying and selling organic rice sourced from South Cotabato to be sold in Davao City. Their contributions included the following: Mr. A Mr. B Cash 250,000.00 380,000.00 Organic rice 180,000.00 Delivery van 1,000,000.00 As agreed, Mr. A's organic rice was revalued at P160,000. The fair value of Mr. B's delivery van is P950,000 on July 1, 2022, and has a mortgage loan balance of P250,000 from the Toyota GenSan branch. Required: 1. Assume the mortgage on the delivery van is treated as Mr. Bs personal obligation: a. Prepare two simple journal entries recording their respective contributions. b. Prepare a Statement of Financial Position as of the date their partnership was formed.

CONCEPTS IN FED.TAX.,2020-W/ACCESS

20th Edition

ISBN:9780357110362

Author:Murphy

Publisher:Murphy

Chapter3: Income Sources

Section: Chapter Questions

Problem 31P

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On July 1, 2022, Mr. A and Mr. B agreed to form a partnership business engaged in buying and selling organic rice sourced from South Cotabato to be sold in Davao City. Their contributions included the following: Mr. A Mr. B Cash 250,000.00 380,000.00 Organic rice 180,000.00 Delivery van 1,000,000.00 As agreed, Mr. A's organic rice was revalued at P160,000. The fair value of Mr. B's delivery van is P950,000 on July 1, 2022, and has a mortgage loan balance of P250,000 from the Toyota GenSan branch. 2. Assume the mortgage on the delivery van is assumed by the partnership: a. Prepare two simple journal entries recording their respective contributions. b. Prepare a Statement of Financial Position as of the date their partnership was formed.
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