On June 1, 2021, Pat and Poi agreed to form a partnership and all non-cash assets will be recorded at fair market value. Pat had an existing business with the following accounts: Cash P50,000; Accounts Receivable P80,000; Supplies P28,000; Equipment P120,000 and Accounts Payable P30,000. Poi agreed that a 5% allowance for bad debts, depreciation of P30,000 for the equipment, 60% of the supplies was already used and the payables will be assumed by the partnership? Poi contributes 150% of the adjusted capital of Pat. How much was increased or decreased in PAT's capital?

Answer rating: 100% (QA)

To determine the change in Pats capital we need to calculate the adjusted capital of Pat and the con... View the full answer