The Following Information Relates to Questions

question 5

Multiple Choice

The following information relates to Questions
A Ltd and B Ltd have established the AB Joint Operation. A Ltd has a 60% interest in the joint operation and B Ltd has a 40% interest.

A Ltd contributed an asset with a carrying amount of $90,000 and a fair value of $120,000 and B Ltd agreed to provide technical services to the joint operation over the first two years of operations. The fair value of the technical services was agreed to be $80,000 and the cost to provide the services was estimated at $65,000 at the inception of the joint operation.

-As part of its initial contribution entry A Ltd will record a:

• A) Debit against the Services Receivable in JO account of $32,000;
• B) Debit against the Plant in JO account of $54,000;
• C) Credit against the Plant of $120,000;
• D) Credit against the Gain on Sale of Plant of $18,000.

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Definitions:

Vastus Intermedius

is a muscle located in the thigh, lying deep to the rectus femoris and part of the quadriceps muscle group.

Rectus Femoris

A muscle in the quadriceps that extends the knee and helps in hip flexion.

Extensor Pollicis Brevis

A muscle in the forearm that extends the thumb.

Thumb

The first digit of the hand, providing a wide range of motion and enabling precise grip and manipulation of objects.