1. Mary, Helga and Luz are partners who share profits and losses in the ratio of 4:2:2, respectively.The partners decide to liquidate and gave you the following balances:CashP400,000Accounts PayableP300,000Accounts200,000Notes Payable400,000ReceivablesMary, CapitalHelga, CapitalLuz, CapitalInventories800,000700.000Equipment700,000400,000Accumulated(100,000)200,000Depreciationa. Accounts Receivable were sold for P175,000b. Inventories were sold for P820,000c. Equipment were sold for P550,000d. Liquidation expenses of P12,000 were paidDirection:A. Use the following table in support of the liquidation process. The cash balance after the paymentof liabilities should reconcile with the capital balances.Capital BalancesMaryP400,000 P700,000 P400,000 P200,000CashHelga Luz| Balances befor liquidationSale of receivables at a lossSale of inventories at a gainSale of equipment at a lossLiquidation expenses paidLiabilities paidDistribution to partnersB. Journalize: a.) each sale; b.) liquidation expenses paid; c.) liabilities paid; and d.) cash paid topartners2. Using the data in number 1 but assume, instead, that all the non-cash assets were sold in lumpsum for half of their book values to Venture Company less liquidation expenses of P15,000. Allpartners are solvent.Direction:A. Prepare a statement of liquidationB. Journalize a.) sale of non-cash assets; b.) payment of liquidation expenses; c.) payment of theliabilities; d.) deficient partner makes additional investment; e.) distribution of remaining cash tothe appropriate partners.3. Using the data in number 1 but assume, instead, that all the non-cash assets were sold forP760,000 less P8,000 liquidation expenses, Assume all partners are insolventA. Prepare a statment of liquidation.B. Journalize a.) sale of the other assets and distribution of loss including the liquidation expenses;b.) payment of liabilities; c.) deficiency, if any, absorbed by other partner(s) and d.) distribution ofremaining cash to appropriate partner(s).

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1. Mary, Helga and Luz are partners who share profits and losses in the ratio of 4:2:2, respectively. The partners decide to liquidate and gave you the following balances: Cash Accounts Payable Notes Payable P400,000 P300,000 Accounts 200,000 400,000 Receivables Mary, Capital Helga, Capital Luz, Capital Inventories 800,000 700,000 (100,000) 700,000 Equipment 400,000 Accumulated 200,000 Depreciation a. Accounts Receivable were sold for P175,000 b. Inventories were sold for P820,000 c. Equipment were sold for P550,000 d. Liquidation expenses of P12,000 were paid Direction: A. Use the following table in support of the liquidation process. The cash balance after the payment of liabilities should reconcile with the capital balances. Capital Balances Cash Mary Helga Luz Balances befor liquidation of receivables at a loss Sale of inventories at a gain Sale of equipment at a loss Liquidation expenses pald Liabilities paid Distribution to partners P400,000 P700,000 P400,000 | P200,000 B. Journalize: a.) each sale; b.) liquidation expenses paid; c.) liabilities paid; and d.) cash paid to partners

1. Mary, Helga and Luz are partners who share profits and losses in the ratio of 4:2:2, respectively. The partners decide to liquidate and gave you the following balances: Cash Accounts Payable Notes Payable P400,000 P300,000 Accounts 200,000 400,000 Receivables Mary, Capital Helga, Capital Luz, Capital Inventories 800,000 700,000 (100,000) 700,000 Equipment 400,000 Accumulated 200,000 Depreciation a. Accounts Receivable were sold for P175,000 b. Inventories were sold for P820,000 c. Equipment were sold for P550,000 d. Liquidation expenses of P12,000 were paid Direction: A. Use the following table in support of the liquidation process. The cash balance after the payment of liabilities should reconcile with the capital balances. Capital Balances Cash Mary Helga Luz Balances befor liquidation of receivables at a loss Sale of inventories at a gain Sale of equipment at a loss Liquidation expenses pald Liabilities paid Distribution to partners P400,000 P700,000 P400,000 | P200,000 B. Journalize: a.) each sale; b.) liquidation expenses paid; c.) liabilities paid; and d.) cash paid to partners

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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