assignment joint 1

8/3/2019 Assignment Joint 1.

1/3

Assignment

Name: Garcia , Mariel G.(Last name, First name, M.I)

PROBLEM 1

Davion, Huskar, and Magnus formed a joint venture in 2011 to sell custom made items. Magnusis designated as the manager of the venture. The venturers agreed to provide profits and lossesin a 9:7:4 ratio. The venture is terminated on December 31, 2011 even though there are stillunsold custom made items. On this date, Magnus trial balance shows the following accountbalances before profit or loss distribution:

Debit CreditJoint Venture Cash P321,000Joint Venture P 64,200Davion, Capital P150,000Huskar, Capital P171,200

Magnus receives P78,360 for his share in the venture profit. Furthermore, he agrees to becharged for the unsold custom made items as of December 31, 2011. What is the Cost of theunsold merchandise charged to Magnus?

ANSWER:

JV before distribution of profit --------------- P 64,200

JV venture profit (P 78,360 x 20/4) --------------- P 391,800

Cost of unsold merchandise inventory P 456,000

PROBLEM 2On April 1, 2012: An, Ann, Anne and formed a Joint venture for sale of merchandise. An wasdesignated as the managing participant. Profit and losses are to be divided as follows: An- 50%,Ann-25% and Anne-25%. On October 31, though the joint venture is still uncompleted, theparticipants agreed to recognize profit and loss on the venture to date. The cost of inventory onhand is P25,000. The joint venture account has a debit balance of P15,000 before distribution ofprofit and loss. No separate books is maintained for the venture, and the participants record intheir individual books all venture transactions. The joint venture profit(loss) on October 31 is:

ANSWER:` JV

Before distribution --- P 15,000 P 25,000 --------unsold inventory

P 10,000 -------JV profit


2/3

PROBLEM 3Bar and Car join in a venture for the sale of football souvenirs at the Rose bowl game. Partnersagree to the following: (1) Bar shall be allowed a commission of 20% on net purchases made by

him, (2) each member shall be allowed a commission of 25% on his own sales, (3) anyremaining profit shall be shared equally. Venture transactions follow:

Bar Car Cash purchases P950 -Expenses paid 150Sales (each keeps his receipts) 800 600

The joint venture profit (loss) is:

ANSWER: JV

Purchases ----- P 950 P 800Expenses------- P 150 P 600

P 1,100 P 1,400

P 300

PROBLEM 4On April 1, 2011, Robles and Sanchez formed a joint venture to acquire and sell a special typeof merchandise. The contractual agreements provide that Robles is to manage the venture for afee and that profits and losses are to be divided equally.On April 2, 2011, Sanchez invests cash of P10,000, which was used to purchase merchandise.Robles incur expenses amounting to P500. On April 17, one half of the merchandise was sold

for P7,200 cash. No further transactions occurred until the end of the month.What is the profit (loss) of the venture for the month of April?

ANSWER:

Sales ----------------------------------------------------------------------------------P 7,200

Less:

Cost of sales

Purchases--------------------------------------------P 10,000

Ending inventory( P 10,000 x 50%) ------------P 5,000 P 5,000

Gross profit P 2,200

Less:

Expense P 500

Net Profit ---------------------------------------------------------------------------------- P 1,700

sales


3/3

PROBLEM 5Jinx and Gremlin are asked by the EFG to handle the marketing of a benefit basketball game.Being avid fans, they readily accepted the offer and formed a joint venture. To achieve anequitable distribution of earnings, they agreed that the partner who finances the purchase oftickets shall be entitled to a 20% commission, and any remainder was to be divided equally.After the game was over, the following information was obtained: Jinx purchased tickets worth

P26,125. Gremlin, advanced P4,125 for expenses, and ticket sales made by Jinx and Gremlin,respectively, were P22,000 and P16,500. How much was Gremlins share in the net income(loss) of the joint venture?

ANSWER:

Sales (P22,000 + P 16,500)------------------------------------------- P 38 ,500

Less:

Cost of sales ------------------------------------------------ P 26,125

Total revenue ------------------------------------------------- P 12,375

Less:

Expense -------------------------------------------------- P 4,125

Gross profit -------------------------------------------------------------------------P 8,250

Less:

Jinxs commission (P 26,125 x 20%) ------------------------------- P 5,225

Net income ------------------------------------------------------------------------ P 3,025

P & L ------------------------------------------------------------------------------- .50

Gremlins share in the net income of the venture-------------------- P 1,512.50

assignment joint 1

Documents