Requirements:  Compute the total liabilities after formation

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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On March 1, 2020, P and Q decided to combine their business and form a partnership. Their balance sheets on March 1 before adjustments showed the following:

They agreed to have the following items recorded in their books:
1. Provide 2% allowance for doubtful accounts.
2. P’s furniture and fixtures should be P31,000, while Q’s office equipment is underdepreciated by P250.
3. Rent expense incurred previously by P was not yet recorded amounting to P1000, while
salary expenses incurred by Q amounting to P800 was also not recorded.
4. The fair value of P’s anf Q’s inventory amounted to P29,500 and P21,000 each
respectively

Requirements: 
Compute the total liabilities after formation

P
Cash
9,000
18,500
30,000
30.000
11,500
3,750
13,500
19,500
9,000
2,750
Accounts receivable
Inventories
Furniture and Fixture
Office equipment
Prepaid expenses
Total
6,375
105,375
3,000
51,500
Accounts payable
Capital
Total
45,750
18,000
59,625
105,375
33,500
51,500
Transcribed Image Text:P Cash 9,000 18,500 30,000 30.000 11,500 3,750 13,500 19,500 9,000 2,750 Accounts receivable Inventories Furniture and Fixture Office equipment Prepaid expenses Total 6,375 105,375 3,000 51,500 Accounts payable Capital Total 45,750 18,000 59,625 105,375 33,500 51,500
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