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Joint Operation/Arrangement On May 1, 2019, Watson and Fernando formed a joint operation to acquire and sell a special type of merchandise. The contractual arrangements
Joint Operation/Arrangement
On May 1, 2019, Watson and Fernando formed a joint operation to acquire and sell a special type of merchandise. The contractual arrangements provide that Watson is to manage the joint operation for a fee and that gain, and losses are to be divided equally. On May 1, 2019, Fernando invests cash of P50,000, which was used to purchase merchandise. Watson incurs expenses amounting to P2,460. On May 20, one half of the merchandise was sold for P36,700 cash. What is the profit (loss) of the joint operation for the month of May? (Assuming no further transactions occurred until the end of the month)Step by Step Solution
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