Please help me to solve this question. Please

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Please help me to solve this question.
Please show all the necessary steps and reasoning for the answer.

If the photo is not clear, you can get a better photo at the 2 links
provided here :

http://i1197.photobucket.com/albums/aa429/Ashish_kumar88/6-78.jpg

EXHIBIT 6-6 FOR question
http://i1197.photobucket.com/albums/aa429/Ashish_kumar88/financial%20accounting/Exhibit6-6for6-78.jpg


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