June 1, 2022, AZ invited MG to join him in his business. MG agreed provided that AZ will adjust the accumulated depreciation of his equipment account to a certain amount, and will recognize additional accrued expenses of P40,000. After that, MG is to invest additional pieces of equipment make her interest equal to 45%. If the capital balances of AZ before and after adjustment were 556,00 and 484,000 respectively, what is the effect in the carrying value of the equipment as a result of the admission of MG?
June 1, 2022, AZ invited MG to join him in his business. MG agreed provided that AZ will adjust the accumulated depreciation of his equipment account to a certain amount, and will recognize additional accrued expenses of P40,000. After that, MG is to invest additional pieces of equipment make her interest equal to 45%. If the capital balances of AZ before and after adjustment were 556,00 and 484,000 respectively, what is the effect in the carrying value of the equipment as a result of the admission of MG?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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On June 1, 2022, AZ invited MG to join him in his business. MG agreed provided that AZ will adjust the accumulated depreciation of his equipment account to a certain amount, and will recognize additional accrued expenses of P40,000. After that, MG is to invest additional pieces of equipment make her interest equal to 45%. If the capital balances of AZ before and after adjustment were 556,00 and 484,000 respectively, what is the effect in the carrying value of the equipment as a result of the admission of MG?
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