FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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Question
Golnesa sold her interest in a
$18,000
$27,000
$57,000
$66,000
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- Wylie is a general partner in a service-providing partnership and receives cash of $290,300 in liquidation of his partnership interest, in which he has a basis of $217,725. The partnership owns no hot assets and continues in existence. After following all of the classification requirements of § 736, $195,953 of this amount is classified as a property payment [§ 736(b)] and $94,347 is classified as a guaranteed payment [§ 736(a)] (assume that this payment is for unstated partnership goodwill). As a result of the liquidation proceeds, how much will Wylie recognize as a capital gain or loss, and how much will be ordinary income? How much can the partnership likely deduct? Wylie recognizes a $ likely deduct $ and he recognizes $ capital loss which is a guaranteed payment as ordinary income. The partnership canarrow_forwardProvide answer this questionarrow_forwardpvn.2arrow_forward
- Answer pleasearrow_forwardAlex and Bess have been in partnership for many years. The partners, who share profits and losses on a 70:30 basis, respectively, wish to retire and have agreed to liquidate the business. Liquidation expenses are estimated to be $6,500. At the date the partnership ceases operations, the balance sheet is as follows: $ 65,000 240,000 $ 47,500 168,000 89,500 Cash Liabilities Noncash assets Alex, capital Bess, capital Total liabilities and capital Total assets $ 305,000 $ 305,000 Part A: Prepare journal entries for the following transactions that occurred in chronological order: a. Distributed safe cash payments to the partners. b. Paid $28,500 of the partnership's liabilities. c. Sold noncash assets for $257,500. d. Distributed safe cash payments to the partners. e. Paid remaining partnership liabilities of $19,000. f. Paid $5,100 in liquidation expenses; no further expenses will be incurred. g. Distributed remaining cash held by the business to the partners. Part B: Prepare a final…arrow_forwardPlease do not give solution in image format thankuarrow_forward
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