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Problem 4 The business assets of Bubay and Tekla appear below: Account Title...

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Problem 4 The business assets of Bubay and Tekla appear below: Account Title Cash Accounts Receivable Inventories Land Building Furniture and Fixtures Other Assets Total Bubay P 11,000 243,536 120,035 603,000 Tekla P 22,354 567,890 260,102 50,345 2,000 P 1,020,916 428,267 34,789 3,600 P 1,317,002 Account Payable Notes Payable Geron, Capital Yumol, Capital Total P 178,940 200,000 641,976 P 234,650 345,000 728,352 P 1,317,002 P 1,020,916 Bubay and Tekla agreed to form a partnership contributing their assets and equities subject to the following adjustments: a) Accounts receivable of P20,000 in Bubay's books and P35,000 in Tekla's are uncollectible. b) Inventories of P5,500 and P6,700 are worthless in Bubay's and Tekla's respective books. c) Other assets of P2,000 for Bubay and P3,600 for Tekla are to be written off. Required: 1. Prepare the necessary journal entries in the books of Bubay. 2. Prepare the necessary journal entries in the books of Tekla. 3. Prepare the journal entries for the formation of the partnership as at July 1. 4. Prepare the statement of financial position of the newly formed partnership

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