Problem 12-3A CRAWFORD COMPANY Balance Sheet May 31, 2017 Assets Liabilities and
ID: 2535761 • Letter: P
Question
Problem 12-3A
CRAWFORD COMPANY
Balance Sheet
May 31, 2017
Assets
Liabilities and Owners’ Equity
$29,500
$13,800
25,000
26,600
(1,100
3,500
34,800
32,000
22,000
25,500
(5,800
3,000
$104,400
$104,400
No.
Account Titles and Explanation
Debit
Credit
1.
2.
3.
4.
5.
LINK TO TEXT
Cash
S. Moyer, Capital
A. Jamison, Capital
P. Roper, Capital
LINK TO TEXT
No.
Account Titles and Explanation
Debit
Credit
1.
2.
Problem 12-3A
The partners in Crawford Company decide to liquidate the firm when the balance sheet shows the following.CRAWFORD COMPANY
Balance Sheet
May 31, 2017
Assets
Liabilities and Owners’ Equity
Cash$29,500
Notes payable$13,800
Accounts receivable25,000
Accounts payable26,600
Allowance for doubtful accounts(1,100
) Salaries and wages payable3,500
Inventory34,800
A. Jamison, capital32,000
Equipment22,000
S. Moyer, capital25,500
Accumulated depreciation—equipment(5,800
) P. Roper, capital3,000
Total$104,400
Total$104,400
The partners share income and loss 5:3:2. During the process of liquidation, the following transactions were completed in the following sequence.
1. A total of $51,900 was received from converting noncash assets into cash. 2. Gain or loss on realization was allocated to partners. 3. Liabilities were paid in full. 4. P. Roper paid his capital deficiency. 5. Cash was paid to the partners with credit balances.
Explanation / Answer
Cawford Company Particular Amount (Dr) Amount (Cr) Notes Payable $ 13,800.00 Accounts Payable $ 26,600.00 Salaries & Wages Payable $ 3,500.00 Realisation Expenses $ 31,000.00 To Accounts Receivable=($25000-$1100) $ 23,900.00 To Inventory $ 34,800.00 To Equipment=($22000-$5800) $ 16,200.00 (Being amount transfer to realisation A/c) Cash $ 51,900.00 To Realisation $ 51,900.00 (Being amount of cash realised from sale of non cash items Realisaton A/c $ 43,900.00 To cash $ 43,900.00 (Being amount of Liabilities paid off ($13800+$26600+$3500) A.Jamison Capital=($23000*5/10) $ 11,500.00 S.Moyer, Capital=($23000*3/10) $ 6,900.00 P. Roper ,Capital=($23000*2/10) $ 4,600.00 To Realisation=($31000-$51900+$43900) $ 23,000.00 (Being amount of loss on realisation transfer to Partner's Capital A/c) Partner's Capital A/c A.Jemison's Capital A/c Particular Amount Particular Amount To Realisation A/c $ 11,500.00 By Balance b/d $ 32,000.00 To Cash $ 20,500.00 Total $ 32,000.00 $ 32,000.00 S.Moyer's Capital A/c Particular Amount Particular Amount To Realisation A/c $ 6,900.00 By Balance b/d $ 25,500.00 To Cash $ 18,600.00 Total $ 25,500.00 $ 25,500.00 P.Roper's Capital A/c Particular Amount Particular Amount To Realisation A/c $ 4,600.00 By Balance b/d $ 3,000.00 By Cash $ 1,600.00 Total $ 4,600.00 $ 4,600.00 Cash A/c Particular Amount Particular Amount To Bal b/d $ 29,500.00 By realisation $ 43,900.00 To Realisation A/c $ 51,900.00 By A.Jemison's Capital A/c $ 20,500.00 To P/Roper's Capital A/c $ 1,600.00 By S.Moyer's Captal A/c $ 18,600.00 Total $ 83,000.00 $ 83,000.00