College Accounting, Chapters 1-27
College Accounting, Chapters 1-27
23rd Edition
ISBN: 9781337794756
Author: HEINTZ, James A.
Publisher: Cengage Learning,
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Chapter 19, Problem 5SEB
To determine

Prepare the entries for the sale and the allocation of gain.

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Immediately prior to the process of liquidation, partners M, N, and O have capital balances of $70,000, $20,000, and $30,000 respectively.  There is a cash balance of $10,000, noncash assets total $160,000, and liabilities total $50,000.  The partners share net income and losses in the ratio of 2:2:1.   Journalize the entries to record the liquidation outlined below, using “Assets” as the account title for the noncash assets and “Liabilities” as the account title for all creditors' claims.   (a) Sold the noncash assets for $80,000 in cash. (b) Divided the loss on realization. (c) Paid the liabilities. (d) Received cash from the partner with the deficiency. (e) Distributed the cash to the partners. (for each Journal Entry, omit the 4th journalizing step of providing a brief explanation) JOURNAL   Date                                                                             Post.          DR                   CR (a)…
A balance sheet for the partnership of A, B, and C, who share profits 2:1:1, shows the following balances just before liquidation: Cash: P48,000 Other assets: 238,000 Liabilities: 80,000 A, Capital: 88,000 B, Capital: 62,000 C, Capital: 56,000 On the first month of liquidation, certain non- cash assets were sold resulting to a loss of P23,000. Liquidation expenses of P4,000 were paid, and additional liquidation expenses of P3,200 are withheld to anticipate payment before liquidation is completed. After creditors were paid, partner B received P13,000 on the initial installment. Determine total payment to partners on the initial installment.
A balance sheet for the partnership of A, B, and C, who share profits 2:1:1, shows the following balances just before liquidation: Cash: P48,000 Other assets: 238,000 Liabilities: 80,000 A, Capital: 88,000 B, Capital: 62,000 C, Capital: 56,000 On the first month of liquidation, certain non-cash assets were sold resulting to a loss of P23,000. Liquidation expenses of P4,000 were paid, and additional liquidation expenses of P3,200 are withheld to anticipate payment before liquidation is completed. After creditors were paid, partner B received P13,000 on the initial installment. Determine the total book value of the non-cash assets on the first month.
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College Accounting, Chapters 1-27
Accounting
ISBN:9781337794756
Author:HEINTZ, James A.
Publisher:Cengage Learning,