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Problem - Princess admits Xyrisse as a partner in the business. Balance sheet accounts of Princess just before the admission of Xyrisse show: Cash- P26,000, Accounts receivable-P120,000, Merchandise inventory - P 180,000, and Accounts payable- P62,000. It was agreed that for purposes of establishing Mary's interest, the following adjustments be made: 1) an allowance for doubtful accounts of 3% of accounts receivable is to be established 2) merchandise inventory is to be adjusted upward by P25,000, and 3) prepaid expenses of P3,600 and accrued liabilities of P4,000 are to be recognized.
If Xyrisse is to invest sufficient cash to obtain 2/5 interest in the partnership, how much would Xyrisse contribute to the new partnership?
a. 176,000
b. 190,000
c. 95,000
d. 113,980
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