Cheese Partners has decided to close the store. At the date of dosing, Cheese Partners had the following account balances: Capital $9,000 Cash 8,000 Inventory 18,000 Store fixtures 10,000 Accounts payable 20,000 A competitor agrees to buy the inventory and store fixtures for $24,000. Prepare the journal entries detailing the liquidation, assuming that partners Colette and Swarma are sharing profits on a 50:50 basis. If an amount box does not require an entry, leave it blank. Cash

Cheese Partners has decided to close the store. At the date of dosing, Cheese Partners had the following account balances: Capital $9,000 Cash 8,000 Inventory 18,000 Store fixtures 10,000 Accounts payable 20,000 A competitor agrees to buy the inventory and store fixtures for $24,000. Prepare the journal entries detailing the liquidation, assuming that partners Colette and Swarma are sharing profits on a 50:50 basis. If an amount box does not require an entry, leave it blank. Cash

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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The statement of Financial Position of Highschool Kids, just before liquidation is as follows: Assets Liabilities & Capital Cash 50,000 Liabilities 70,000 Other assets 140,000 Loan, Young 20,000 Loans to Broke 10,000 Young, capital (50%) 30,000 Dumb, capital (30%) 50,000 Broke, capital (20%) 30,000 Total 200,000 Total 200,000 The partners Young and Dumb are personally insolvent. If non cash assets are sold for P150,000 and all liabilities are paid and liquidation expense of P5,000 are also paid, how much cash should Young, Dumb and Broke receive? Young Dumb Broke A. 32,500 51,500 31,000 B. 55,000 53,000 22,000 C. 52,500 51,500 21,000 D. 47,500 48,500 19,000
Lester, Torres, and Hearst are members of Arcadia Sales, LLC, sharing income and losses in the ratio of 2:2:1, respectively. The members decide to liquidate the limited liability company. The members’ equity prior to liquidation and asset realization on August 1 are as follows: Lester $53,120 Torres 55,790 Hearst 26,560 Total $135,470 In winding up operations during the month of August, noncash assets with a book value of $157,550 are sold for $170,590, and liabilities of $47,430 are satisfied. Prior to realization, Arcadia Sales has a cash balance of $25,350. Required: a. Prepare a statement of LLC liquidation. Refer to the list of Amount Descriptions for the exact wording of the answer choices for text entries. For those boxes in which you must enter negative numbers (balance deficiencies, payments, cash distributions, divisions of loss), use a minus sign. If there is no amount to be reported for sale of assets, payment of liabilities, receipt of deficiency,…
Lester, Torres, and Hearst are members of Arcadia Sales, LLC, sharing income and losses in the ratio of 2:2:1, respectively. The members decide to liquidate the limited liability company. The members' equity prior to liquidation and asset realization on August 1 are as follows: Lester $28,800 Torres 66,600 Hearst 41,400 Total $136,800 In winding up operations during the month of August, noncash assets with a book value of $180,000 are sold for $223,200, and liabilities of $58,800 are satisfied. Prior to realization, Arcadia Sales has a cash balance of $15,600.
Merideth Harper has invested 25,000 in SW Development. The firm has recently declared bankruptcy and has 60,000 in unpaid debts. Explain the paymentsif any if Merideth in these situations. SW Development Company is in the sole owner owed the 60,000. SW Development Comany unlimited liability in a 50/50 patnership Ms Harper has unlimited liability for unpaid bills which means creditors can only claim against the 25,000 she invested Mrs Harper limited liablity which is 60,000
Cam, Andy and Rae are partners in CAR Brokers and share losses in a 3:4:3 ratio, respectively. The balance sheet on December 31, 2023, when they decide to liquidate the business, is as follows: Assets Liabilities and Capital Cash $1,875,000 Accounts Payable $1,000,000 Noncash Assets $937,000 Cam, Loan 312,000 Cam, Capital 500,000 Andy, Capital 375,000 Rae, Capital 625,000 Total Assets $2,812,000 Total Liabilities & Equities $2,812,000 Note: A revaluation was done for non-cash assets valuing them at $1,002,000. The noncash assets were then sold for $800,000. As the accountant for the partnership, how do i prepare a Revaluation account
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Big owns 60% of Little and at December 31, 2012, its Investment in Little account stands at $6,000,000. On that date Big sells half its ownership for $4,000,000 cash. a. Prepare the journal entry to be recorded by Big on December 31, 2012. c. Same facts as above, except the sales price is $2,500,000 cash. Prepare the journal entry to be recorded by Big on December 31, 2012.
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Oregon Corporation has filed a voluntary petition to reorganize under Chapter 11 of the Bankruptcy Reform Act. Its creditors are considering an attempt to force liquidation. The company currently holds cash of $6,000 and accounts receivable of $25,000. In addition, the company owns four plots of land. The first two (labeled A and B) cost $8,000 each. Plots C and D cost the company $20,000 and $25,000, respectively. A mortgage lien is attached to each parcel of land as security for four different notes payable of $15,000 each. Presently, the land can be sold for the following: Plot A . . . . . . . . . . . . . . . . . .. $16,000Plot B . . . . . . . . . . . . . . . . . .. $11,000Plot C . . . . . . . . . . . . . . . . . .. $14,000Plot D . . . . . . . . . . . . . . . . . . $27,000 Another $25,000 note payable is unsecured. Accounts payable at this time total $32,000. Of this amount, $12,000 is salary owed to the company’s workers. No employee is due more than $3,400.The company expects to…
Cullumber Company wishes to liquidate the firm by distributing the company's cash to the three partners. Prior to the distribution of cash, the company's balances are Cash $64,000; Oakley, Capital (Cr.) $48,400; Quaney, Capital (Dr.) $18,480; and Ellis, Capital (Cr.) $34,080. The income ratios of the three partners are 3:4:3, respectively. Prepare the entry to record the absorption of Quaney's capital deficiency by the other partners and the distribution of cash to the partners with credit balances. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Account Titles and Explanation Oakley, Capital Ellis, Capital Quaney, Capital (To record write-off of capital deficiency) Oakley, Capital Ellis, Capital Cash (To record distribution of cash to the partners) Debit 14605 19474 33795 14606 Credit AND IN 34079 48401 2
Oregon Corporation has filed a voluntary petition to reorganize under Chapter 11 of the Bankruptcy Reform Act. Its creditors are considering an attempt to force liquidation. The company currently holds cash of $6,000 and accounts receivable of $25,000. In addition, the company owns four plots of land. The first two (labeled A and B) cost $8,000 each. Plots C and D cost the company $20,000 and $25,000, respectively. A mortgage lien is attached to each parcel of land as security for four different notes payable of $15,000 each. Presently, the land can be sold for the following:Another $25,000 note payable is unsecured. Accounts payable at this time total $32,000. Of this amount, $12,000 is salary owed to the company’s workers. No employee is due more than $3,400.The company expects to collect $12,000 from the accounts receivable if liquidation becomes necessary. Administrative expenses required for liquidation are anticipated to be $16,000.a. Prepare a statement of financial affairs for…