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What the amount of cash from the joint operation

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Question - On January 1, 2018, A Company, B Company, and C Company established D Entity, and agreed to share joint control over the joint arrangement. Each of the aforementioned participants has classified the undertaking as a Joint Operation. A contributed P60,000 cash; B contributed equipment with a book carrying value of P69,000; and C contributed machinery with a carrying amount of P54,000. Both non-monetary contributions by B and C have a fair value of P60,000 and an estimated useful life of 5 years.

1. What the amount of cash from the joint operation that A Company will recognize as it records its own contribution on January 1, 2018?

a. P33,000

b. P0

c. P18,000

d. P20,000

2. What the amount of (1) Equipment, net and (2) Machinery, net that C will recognize in its books on January 1, 2018 will be?

a. (1) P23,000 and (2) P20,000

b. (1) P20,000 and (2) P20,000

c. (1) P20,000 and (2) P18,000

d. (1) P23,000 and (2) P18,000

Reference no: EM133003238

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