avid Wallace, Olena Dunn, and Danny Lin were partners in a commercial architect firm and showed the following account balances as of December 31, 2020:     Cash   Equipment   Accum. Deprec. Equipment   Accounts Payable   Notes Payable   David Wallace, Capital   Olena Dunn, Capital   Danny Lin, Capital   Account balances December 31, 2020 $ 25,600     $ 170,000

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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David Wallace, Olena Dunn, and Danny Lin were partners in a commercial architect firm and showed the following account balances as of December 31, 2020:
 

  Cash   Equipment   Accum.
Deprec.
Equipment
  Accounts
Payable
  Notes
Payable
  David
Wallace,
Capital
  Olena
Dunn,
Capital
  Danny
Lin,
Capital
 
Account balances December 31, 2020 $ 25,600     $ 170,000     $ 95,000     $ 7,600     $ 18,000     $ 37,000     $ 20,000     $ 18,000    
 


Due to several unprofitable periods, the partners decided to liquidate the partnership. The equipment was sold for $62,000 on January 1, 2021. The partners share any profit (loss) in the ratio of 2:1:1 for Wallace, Dunn, and Lin, respectively.

Required:
1. Complete the schedule. (Negative answers should be indicated by a minus sign.)


2. Prepare the liquidation entries (sale of equipment, allocation of gain/loss, payment of creditors, final distribution of cash).

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