11. The Besto Company at December 31 has cash $40,000, noncash assets $200,000, liabilities $110,000, and the following capital balances: Ridha $90,000 and Esther $40,000. The firm is liquidated, and $220,000 in cash is received for the noncash assets. Ridha and Esther income ratios are 60% and 40%, respectively. Required: a) Prepare a schedule of cash payments b) Show the journal entry for distribution of cash to both the partners.
11. The Besto Company at December 31 has cash $40,000, noncash assets $200,000, liabilities $110,000, and the following capital balances: Ridha $90,000 and Esther $40,000. The firm is liquidated, and $220,000 in cash is received for the noncash assets. Ridha and Esther income ratios are 60% and 40%, respectively. Required: a) Prepare a schedule of cash payments b) Show the journal entry for distribution of cash to both the partners.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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11. The Besto Company at December 31 has cash $40,000, noncash assets $200,000, liabilities $110,000, and the following capital balances: Ridha $90,000 and Esther $40,000. The firm is liquidated, and $220,000 in cash is received for the noncash assets. Ridha and Esther income ratios are 60% and 40%, respectively.
Required:
a) Prepare a schedule of cash payments
b) Show the journal entry for distribution of cash to both the partners.
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