March, April, and May have been in partnership for a number of years. The partne

Question

March, April, and May have been in partnership for a number of years. The partners allocate all profits and losses on a 4:2:2 basis, respectively. Recently, each partner has become personally insolvent and, thus, the partners have decided to liquidate the business in hopes of remedying their personal financial problems. As of September 1, the partnership’s balance sheet is as follows:

Prepare journal entries for the following transactions: (Do not round intermediate calculations.)

  Cash $ 27,000      Liabilities $ 91,000      Accounts receivable 116,000      March, capital 58,000      Inventory 96,000      April, capital 91,000      Land, building, and equipment (net) 63,000      May, capital 62,000        Total assets $ 302,000        Total liabilities and capital $ 302,000   

Explanation / Answer

Cash DR 72000 Loss on Sales 24000       To Inventory 96000 Liquidation Expenses   Dr 12000     To Cash 12000 Liabilities   Dr 56000     To Cash 56000 cash Dr 65000     To Accounts Receivable 65000 Cash   Dr 33000 Loss on sales 30000 To Land Building & Equip 63000

Related Questions

Navigate

• Browse (All)
• Browse M
• Subjects

---