A, B, and C have been partners for years and have been dividing the profits 2:3:3 with the following balances: DR: Cash 120,000 DR: AR 420,000 CR: ADA 25,000 DR: Inventory 580,000 DR: Vehicle 1,000,000 CR: Accum. Dep'n 600,000 CR: Accounts Payable 595,000 CR: B Loan 100,000 CR: A, Capital 300,000 CR: B, Capital200,000 Cr: C, Capital 300,000 If at the first realization, P900,000 worth of net non-cash assets were sold for P480,000, how much should B absorb from theoretical loss using the Theoretical Loss Approach method? Oa. 35,625 O b. 0 O c. 178,125 d. 71,250
A, B, and C have been partners for years and have been dividing the profits 2:3:3 with the following balances: DR: Cash 120,000 DR: AR 420,000 CR: ADA 25,000 DR: Inventory 580,000 DR: Vehicle 1,000,000 CR: Accum. Dep'n 600,000 CR: Accounts Payable 595,000 CR: B Loan 100,000 CR: A, Capital 300,000 CR: B, Capital200,000 Cr: C, Capital 300,000 If at the first realization, P900,000 worth of net non-cash assets were sold for P480,000, how much should B absorb from theoretical loss using the Theoretical Loss Approach method? Oa. 35,625 O b. 0 O c. 178,125 d. 71,250
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Transcribed Image Text:A, B, and C have been partners for years and have been dividing the profits 2:3:3 with the following balances:
DR: Cash 120,000
DR: AR 420,000
CR: ADA 25,000
DR: Inventory 580,000
DR: Vehicle 1,000,000
CR: Accum. Dep'n 600,000
CR: Accounts Payable 595,000
CR: B Loan 100,000
CR: A, Capital 300,000
CR: B, Capital200,000
Cr: C, Capital 300,000
If at the first realization, P900,000 worth of net non-cash assets were sold for P480,000, how much should B absorb
from theoretical loss using the Theoretical Loss Approach method?
O a. 35,625
O b. 0
O c. 178,125
O d. 71,250
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