Bobby and Cobby agreed to combine their businesses and form a partnership. The ledger accounts prior to adjustments showed the following balances:

Cash

BOBBY P84,000

COBBY P126,000

Accounts Receivable

BOBBY 63,000

COBBY 105,000

Inventory

BOBBY 157,500

COBBY 52,500

Equipment

COBBY 63,000

Accumulated Depreciation

COBBY (21,000)

Accounts Payable

BOBBY (21,000)

The following adjustments are to be made for the purposes of establishing the capital credit of the partners:

1.Ten percent (10%) bad debts (impairment loss) should be provided on the outstanding accounts receivable.

2.The market value of the inventory is 80% of cost.

3.The carrying amount of the equipment is only P33,600.

4.Bobby will recognize prepaid expenses of P8,400.

5.Cobby will recognize accrued expenses of P6,825.

Give all the entries necessary for the following scenarios:

a.Books of Bobby will be used

b.Books of Cobby will be used

c.New set of books will be used by the partnership (