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Sample Problems For Joint Venture and Consignment

The document describes the transactions of a joint operation between companies XX and YY to manufacture plasma in 2017. It details contributions of cash and loans to purchase machinery, equipment, and raw materials. It also lists labor costs, loan repayments, depreciation, transfers between work in process and finished goods inventory, and sales to the joint operators. It provides several problems to determine ending cash balance, work in process balance, total assets at year end, and XX's investment amount. It also summarizes a consignment transaction between KK Co. and SS, Inc. involving the shipment and sale of watches, with associated costs and an advance received. It asks to calculate the amount KK Co. will remit to SS

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Christine Jane Ramos
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1K views1 page

Sample Problems For Joint Venture and Consignment

The document describes the transactions of a joint operation between companies XX and YY to manufacture plasma in 2017. It details contributions of cash and loans to purchase machinery, equipment, and raw materials. It also lists labor costs, loan repayments, depreciation, transfers between work in process and finished goods inventory, and sales to the joint operators. It provides several problems to determine ending cash balance, work in process balance, total assets at year end, and XX's investment amount. It also summarizes a consignment transaction between KK Co. and SS, Inc. involving the shipment and sale of watches, with associated costs and an advance received. It asks to calculate the amount KK Co. will remit to SS

Uploaded by

Christine Jane Ramos
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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SAMPLE PROBLEMS FOR JOINT VENTURE AND CONSIGNMENT:

On January 1, 2017, XX Company and YY Company signed an agreement to form a joint


operation to manufacture a product called plasma. This product is used in the manufacture of
television. The following are the transactions that transpired to joint operations for 2017:

a. To commence operations, both operators contributed P250,000 in cash


b. Contributions of cash by the operators
c. Use of cash and loans to buy machinery and equipment costing P130,400 (cash paid,
P80,000 and the balance on a loan account) and raw materials purchased on account costing
P109,200.
d. Labor incurrence amounting to P120,960 with P130,600 paid in cash
e. Loans from the Bank P100,000.
f. Repayment of loan-machinery and equipment, P16,800, raw materials amounting to P70,560,
and other factory expenses of P218,400.
g. Depreciation of machinery and equipment, P10,440.
h. Transfer of materials, labor and overhead to Work in Process: Payroll, P120,960; Materials,
P80,640; Factory Overhead-Heat, Light and Power, P218,400 and depreciation of P13,440.
i. Transfer of Work In Process to Finished Goods Inventory, P302,400
j. Transfer of Finished Goods Inventory, P268,800 to Joint Operator throughout the year.

3. Determine the ending balance in cash

4. Work In Process Ending balance amounted to:

5. The December 31, 2017, total assets amounted to:

6. The December 31, 2017, XX Investment amounted to:

The following summary on the books of KK Company in relation to consignment transaction from SS, Inc.
appears as follows:
Consignment sales, 4 watches at P1,500,000
Consignor’s costs:
Shipment of 10 Rolex “Daytona” watches, P2,000,000
Freight-out, P100,000
Consignee’s charges:
Cartage-in, P70,000
Commission, P340,000
Advertisement, P220,000
Advances received by the consignor amount to P500,000.

_______10. The amount remitted by KK Co. to SS, Inc. is:

________11. The consignment profit is:

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