Kara and Mia formed a joint arrangement to acquire and sell a special type of merchandise. Kara is to manage the joint arrangement and to furnish the capital. The joint operations are to share equally any gain or loss on the joint operations. On April 1,2020, Mia sent Kara P10,000 cash, which was all used to purchase merchandise, Kara paid freight of P240 on the merchandise purchased. On April 27, one half of the merchandise was sold for P7,200 cash. Kara paid the cost of delivering merchandise to customers which amounted to P260. No further transactions occurred until the end of the month. The profit(loss) of the joint arrangement for the month of April,2020 is:

Kara and Mia formed a joint arrangement to acquire and sell a special type of merchandise. Kara is to manage the joint arrangement and to furnish the capital. The joint operations are to share equally any gain or loss on the joint operations. On April 1,2020, Mia sent Kara P10,000 cash, which was all used to purchase merchandise, Kara paid freight of P240 on the merchandise purchased. On April 27, one half of the merchandise was sold for P7,200 cash. Kara paid the cost of delivering merchandise to customers which amounted to P260. No further transactions occurred until the end of the month. The profit(loss) of the joint arrangement for the month of April,2020 is:

SWFT Comprehensive Volume 2019

42nd Edition

ISBN:9780357233306

Author:Maloney

Publisher:Maloney

Chapter14: Property Transactions: Capital Gains And Losses, § 1231, And Recapture Provisions

Section: Chapter Questions

Problem 37CE

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