Debit balance in capital of a 150000 number 17 answer

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Debit balance in capital of A (150,000) Number 17 Answer D Estimated future liquidating expenses on January 31, 2019 150,000 Add: carrying amount of remaining noncash assets on January 31, 2019 (1,400,000 – 1,000,000) 400,000 Maximum possible loss on January 31, 2019 550,000 B’s share in maximum possible loss (P550,000 x 30%) 165,000 Number 18 Answer C
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Cash withheld for future liquidating expenses 150,000 Add: Cash withheld for remaining unpaid liabilities to third persons (P2,000,000 x 80%) 1,600,000 Total cash withheld on January 31, 2019 1,750,000 Number 19 Answer C Amount received by holder of note payable (NRV of Inventory) 250,000 Note: Only the net realizable value of collateral inventory will be received since there is no available net free asset. Page 5 Number 20 Answer D Amount received by holder of mortgage payable (Fair value of Land) 100,000 Note: The mortgage payable will be fully collected because it is fully secured credit. Number 21 Answer B Cash 100,000 Add: Free assets from fully secured mortgage payable (P120,000 – P100,000) 20,000 Total Free assets for unsecured credits with priority 120,000 Amount received by employees for their salary 120,000 Note: Since only P120,000 free assets are available, it must all be given to employees who are preferred over the government. Number 22 Answer C Amount received by partially secured loan payable 340,000 Less: Fair value of collateral – machinery (300,000) Recovered amount from the unsecured portion of partially secured loans payable 40,000 Divided by unsecured portion of partially secured loan payable (400,000 – 300,000) /100,000 Recovery percentage on unsecured credits 40% Amount received by holder of accounts payable (P100,000 x 40%) 40,000 Number 23 Answer A Accounts payable 100,000 Add: Unsecured portion of partially secured loan payable (400,000 –P300,000) 100,000 Total unsecured credits including unsecured portion of partially secured loans payable 200,000 Multiply by recovery percentage of unsecured credits x 40% Net free assets 80,000 Number 24 Answer C Land owned by Entity A 3,000,000 Add: Interest of Entity A on co-owned inventory (P1,000,000 x 60%) 600,000 Total assets to be reported by Entity A concerning its interest in Entity C 3,600,000
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Number 25 Answer A Notes payable owed by Entity B 1,000,000 Add: Interest of Entity B on co-owed accounts payable (P2,000,000 x 40%) 800,000 Total liabilities to be reported by Entity B concerning its interest in Entity C 1,800,000 Number 26 Answer B Sales revenue reported by Entity C 5,000,000 Less: Unsold inventory of Entity A coming from Entity C (P1,000,000 x 70%) (700,000) Less: Unsold inventory of Entity B coming from Entity C (P2,000,000 x 40%) (800,000) Sales revenue to third persons 3,500,000 Sales revenue to be reported by Entity A (P3,500,000 x 60%) 2,100,000 Page 6 Number 27 Answer C Entity A’s investment in Entity C – 1/1/2018 1,000,000 Share in 2018 net income of Entity C (2,000,000 x 40%) 80,000 Share in 2018 cash dividend of Entity C (100,000 x 40%) ( 40,000) Share in 2019 net loss of Entity C (2,000,000 x 40%) ( 800,000) Carrying amount – December 31, 2019 240,000 Number 28 Answer C Entity B’s investment in Entity C 1,500,000 Share in 2018 net income of Entity C (200,000 x 60%) 120,000 Share in 2018 cash dividend of Entity C (100,000 x 60%) ( 60,000) Share in 2018 net loss of Entity C (2,000,000 x 60%) (1,200,000) Carrying amount – December 31, 2019 360,000 Number 29 Answer C Unadjusted investment income of Entity A for 2018 (P1,000,000 x 60%) 600,000 Less:
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