Alex and Bess have been in partnership for many years. The partners, who share profits and losses on a 70:30 basis, respectively, wish to retire and have agreed to liquidate the business. Liquidation expenses are estimated to be $6,500. At the date the partnership ceases operations, the balance sheet is as follows: $ 47,500 168,000 89,500 $ 305,000 Cash Noncash assets $ 65,000 240,000 Liabilities Alex, capital Bess, capital Total assets $ 305,000 Total liabilities and capital Part A: Prepare journal entries for the following transactions that occurred in chronological order: a. Distributed safe cash payments to the partners. b. Paid $28,500 of the partnership's liabilities. c. Sold noncash assets for $257,500. d. Distributed safe cash payments to the partners. e. Paid remaining partnership liabilities of $19,000. f. Paid $5,100 in liquidation expenses; no further expenses will be incurred. g. Distributed remaining cash held by the business to the partners. Part B: Prepare a final statement of partnership liquidation.
Alex and Bess have been in partnership for many years. The partners, who share profits and losses on a 70:30 basis, respectively, wish to retire and have agreed to liquidate the business. Liquidation expenses are estimated to be $6,500. At the date the partnership ceases operations, the balance sheet is as follows: $ 47,500 168,000 89,500 $ 305,000 Cash Noncash assets $ 65,000 240,000 Liabilities Alex, capital Bess, capital Total assets $ 305,000 Total liabilities and capital Part A: Prepare journal entries for the following transactions that occurred in chronological order: a. Distributed safe cash payments to the partners. b. Paid $28,500 of the partnership's liabilities. c. Sold noncash assets for $257,500. d. Distributed safe cash payments to the partners. e. Paid remaining partnership liabilities of $19,000. f. Paid $5,100 in liquidation expenses; no further expenses will be incurred. g. Distributed remaining cash held by the business to the partners. Part B: Prepare a final statement of partnership liquidation.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
![Alex and Bess have been in partnership for many years. The partners, who share profits and losses on a 70:30 basis, respectively, wish
to retire and have agreed to liquidate the business. Liquidation expenses are estimated to be $6,500. At the date the partnership
ceases operations, the balance sheet is as follows:
$ 65,000
240,000
$ 47,500
168,000
89,500
Cash
Liabilities
Noncash assets
Alex, capital
Bess, capital
Total liabilities and capital
Total assets
$ 305,000
$ 305,000
Part A: Prepare journal entries for the following transactions that occurred in chronological order:
a. Distributed safe cash payments to the partners.
b. Paid $28,500 of the partnership's liabilities.
c. Sold noncash assets for $257,500.
d. Distributed safe cash payments to the partners.
e. Paid remaining partnership liabilities of $19,000.
f. Paid $5,100 in liquidation expenses; no further expenses will be incurred.
g. Distributed remaining cash held by the business to the partners.
Part B: Prepare a final statement of partnership liquidation.
Complete this question by entering your answers in the tabs below.
Required A
Required B](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F052d489f-0569-4cf6-b560-6cc4bc818148%2Ff91a03c4-9517-4fb9-bc22-2943b2a5c074%2Fiq9b4dm_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Alex and Bess have been in partnership for many years. The partners, who share profits and losses on a 70:30 basis, respectively, wish
to retire and have agreed to liquidate the business. Liquidation expenses are estimated to be $6,500. At the date the partnership
ceases operations, the balance sheet is as follows:
$ 65,000
240,000
$ 47,500
168,000
89,500
Cash
Liabilities
Noncash assets
Alex, capital
Bess, capital
Total liabilities and capital
Total assets
$ 305,000
$ 305,000
Part A: Prepare journal entries for the following transactions that occurred in chronological order:
a. Distributed safe cash payments to the partners.
b. Paid $28,500 of the partnership's liabilities.
c. Sold noncash assets for $257,500.
d. Distributed safe cash payments to the partners.
e. Paid remaining partnership liabilities of $19,000.
f. Paid $5,100 in liquidation expenses; no further expenses will be incurred.
g. Distributed remaining cash held by the business to the partners.
Part B: Prepare a final statement of partnership liquidation.
Complete this question by entering your answers in the tabs below.
Required A
Required B
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