A 50:50 Joint Operation Was Commenced Between Two Participants $\text { DR\quad Building in JO } \quad£ 50,000$

question 7

Multiple Choice

A 50:50 joint operation was commenced between two participants. Participant One contributed cash of £50 000, and Participant Two contributed a Building with a fair value of £50 000. Using the line-by-line method of accounting, participant One would record:

• A)\(\text { DR\quad Building in JO } \quad£ 50,000\)
• \(\text { CR } \quad \text { Cash } \quad\quad\quad £ 50,000\)
• B) \(\text { DR\quad Building in JO } \quad£ 50,000\)
• \(\text { CR } \quad \text { Cash } \quad\quad\quad £ 50,000\).
• C)\(\begin{array} { l c c c }
• \text { DR } & \text { Investment in joint operation } & £ 50,000 & \\
• \text { CR } & \text { Cash } & & £ 50,000
• \end{array}\)
• D)
• \(\begin{array} { l c l l }
• \text { DR } & \text { Cash in JO } & £ 25,000 & \\
• \text { DR } & \text { Building in JO } & £ 25,000 & \\
• \text { CR } & \text { Cash } & & £ 50,000
• \end{array}\)

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Definitions:

Demand Schedule

A table showing the quantity of a good or service that consumers are willing and able to purchase at various prices over a specified period.

Short-Run Cost

Expenses that a firm faces in the short term, typically involving costs that vary with the level of output.

Product Promotion

The activities undertaken by a business to make its products or services known to potential customers and persuade them to buy.