Direction: Solve for what is required in profit loss distribution

FORMATION

The following transactions transpired in year 2021. Jan 20 Paid P200,000 to creditors. Jan-21 Sold P250,000 worth of merchandise. Feb-01 Purchased P200,000 worth of merchandise and P25,000 supplies. Feb-14 Sold P300,000 worth of merchandise on account. Mar-31 Lanson made an additional investment of P100,000. Apr-01 Bought new equipment for P155,000 cash. Apr-16 Purchased P150,000 worth of merchandise. May-01 Sold P100,00 worth of merchandise. May-31 Sold P280,000 worth of merchandise. Jun-30 Merchandise inventory on hand is P400,000. Supplies expense is P1 1,000. Collected P210,000 from clients. Additional info: a. PPE were given 3 years useful life with no salvage value. b. Doubtful accounts is set at 15% of Account Receivable balance. c. Monthly expenses includes Utilities - P1,500; Rent - P4,000The statement of financial position of ABC Company, a single proprietorship on December 01, 2020 is shown below ABC Company Statement of Financial Position December 01,2020 Assets Cash 630.000.00 Accounts Receivable 1,680,000.00 84,000.00 Less: Allowance for Doubtful Accounts 70,000.00 1,610,000.00 Merchandise Inventory 560,000.00 Property. Plant and Equipment 420,000.00 Less: Accumulated Depreciation 35,000.00 385,000.00 Total Assets 3,185,000.00 Liabilities and Capital Accounts Payable 980,000.00 Mendoza, Capital 2,205,000.00 Total Liabilities and Capital 3. 185.000.00 ABC Company admits Lanson to invest cash equal to one-fourth of Mendoza Capital after adjusting for the following: a. Merchandise Inventory is valued at P612, 500.00 b. Accounts Receivable is estimated to be 95% collectible c. Recoverable amount of property, plant and equipment is estimated to be P280, 000