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Partnership Liquidation exercise

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Question;After the accounts;are closed on July 3, 2012, prior to liquidating the partnership, the capital;accounts of Rebecca Adams, Austin Cooper, and Ricardo Ruiz are $31,500, $5,700;and $23,700, respectively. Cash and noncash assets total $7,200 and $61,300, respectively.;Amounts owed to creditors total $7,600. The partners share income and losses in;the ratio of 1:1:2. Between July 3 and July 29, the noncash assets are sold for;$32,500, the partner with the capital deficiency pays his or her deficiency to;the partnership, and the liabilities are paid.;1. Prepare a statement of partnership;liquidation, indicating;(a) the sale of assets and division of loss;(b) the payment of liabilities;(c) the receipt of the deficiency (from the;appropriate partner), and;(d) the distribution of cash.;Enter any subtractions (balance deficiencies;payments, cash distributions, divisions of loss) as negative numbers using a;minus sign. If there is no amount or an amount is zero, enter "0".;2. Assume the partner with the capital;deficiency declares bankruptcy and is unable to pay the deficiency.;a. Journalize the entry to allocate the;partner's deficiency. If an amount box does not require an entry, leave it;blank.;b. Journalize the entry to distribute the;remaining cash. If an amount box does not require an entry, leave it blank.

 

Paper#45171 | Written in 18-Jul-2015

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