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Question - Chua and Wong are forming a partnership. Chua will invest a building that currently is being used by another business owned by Chua. The building has a market value of P900,000. Also, the partnership will assume responsibility for a P300,000 note secured by a mortgage on that building. Wong will invest P500,000 cash. For the partnership, what the amounts to be recorded for the building and for Chua's Capital account?
Using effective interest amortization, how much interest expense will be recognized in 2012? What will the carry value of the bonds be on December 31, 2012
Debit entry for each of them separately and then make one credit entry in the total amount to the Income Summary account.
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