Accounts for liquidation   Mammal Ltd went into voluntary liquidation on 30 June 2023. Its summarised statement of financial position at that date was as follows.                             MAMMAL LTD Statement of financial position as at 30 June 2023   Equity           Current assets             Share capital:           Receivables $ 10  000         160  000 shares issued at a price of $1, called to 50c     $   80  000     Inventories   12  000             Cash   8  000   $ 30  000   Less: Calls in arrears (40  000 at 25c)     (10  000 )                             Non‐current assets                         Land   40  000                     Plant   18  000     58  000               Total assets         88  000               Current liabilities                         Payables         (18  000 ) Total equity   $ 70  000     Net assets       $ 70  000                             All assets realised amounted to $60 000. Calls in arrears were fully collected. Payables allowed a $1000 discount. Costs of liquidation were $5000.   Required Record the above in the Liquidation account, the Liquidator’s Receipts and Payments account and the Shareholders’ Distribution account (using the T ledger account).

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Accounts for liquidation

 

Mammal Ltd went into voluntary liquidation on 30 June 2023. Its summarised statement of financial position at that date was as follows.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

MAMMAL LTD

Statement of financial position

as at 30 June 2023

 

Equity

 

 

 

 

 

Current assets

 

 

 

 

 

 

Share capital:

 

 

 

 

 

Receivables

$

10  000

 

 

 

 

160  000 shares issued at a price of $1, called to 50c

 

 

$

 

80  000

 

 

Inventories

 

12  000

 

 

 

 

 

 

Cash

 

8  000

 

$

30  000

 

Less: Calls in arrears (40  000 at 25c)

 

 

(10  000

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non‐current assets

 

 

 

 

 

 

 

 

 

 

 

 

Land

 

40  000

 

 

 

 

 

 

 

 

 

 

Plant

 

18  000

 

 

58  000

 

 

 

 

 

 

 

Total assets

 

 

 

 

88  000

 

 

 

 

 

 

 

Current liabilities

 

 

 

 

 

 

 

 

 

 

 

 

Payables

 

 

 

 

(18  000

)

Total equity

 

$

70  000

 

 

Net assets

 

 

 

$

70  000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

All assets realised amounted to $60 000. Calls in arrears were fully collected. Payables allowed a $1000 discount. Costs of liquidation were $5000.

 

Required

Record the above in the Liquidation account, the Liquidator’s Receipts and Payments account and the Shareholders’ Distribution account (using the T ledger account).

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