What is the cost of unsold merchandise

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Question - What is the cost of unsold merchandise?

Dwight, Chris, and Paul formed a joint operation in 2011 to sell particular merchandise. Dwight is designated as the manager of the joint operation. The joint operators agreed to divide profits and losses equally. The joint operation is terminated on December 31, 2012 even though there is still unsold merchandise. On this date, Dwight's trial balance shows the following account balances before profit or loss distribution:

 

Debit

Credit

Joint operation cash

P30,000

 

Investment in Joint Operation

6,000

 

Chris, capital

14,000

 

Paul, capital

 

P16,000

Dwight receives P4,500 for his share in the joint operation profit. Furthermore, he agrees to be charged for the unsold merchandise as of December 31, 2012.

Reference no: EM132722709

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