D, E and Fare partners in DEF Partnership. A condensed statement of financial position of the company on April 27, 2016, the day the partners decide to liquidate the business is presented as follows: DEF Partnership Statement of Financial Position April 26, 2016 Assets P 28,000 2,000 9,000 21,000 40,000 Cash Other Assets P 20,000 80,000 Liabilities D, Loan D, capital (40%) E, capital (40%) F, capital (20%) Total Assets P100,000 Total Liabilities and Capital P 100,000 CASE 3: Loss on Realization Resulting Capital Deficiency to a Solvent Partner Assume that the Other Assets were sold for P49,500, thus, resulting to a loss of P30,500 to be divided among the partners using the profit and loss ratio. After the distribution of loss, D's capital account would result to a debit balance of P3,200. Offsetting the entire amount of D's loan account against his capital account still leaves his capital account with a debit balance of P1,200. D has to invest additional cash to fully eliminate his deficiency. Requirement a. Prepare the Statement of Liquidation as of April 26,2016. b. Journal entries required to record the liquidation transactions.
D, E and Fare partners in DEF Partnership. A condensed statement of financial position of the company on April 27, 2016, the day the partners decide to liquidate the business is presented as follows: DEF Partnership Statement of Financial Position April 26, 2016 Assets P 28,000 2,000 9,000 21,000 40,000 Cash Other Assets P 20,000 80,000 Liabilities D, Loan D, capital (40%) E, capital (40%) F, capital (20%) Total Assets P100,000 Total Liabilities and Capital P 100,000 CASE 3: Loss on Realization Resulting Capital Deficiency to a Solvent Partner Assume that the Other Assets were sold for P49,500, thus, resulting to a loss of P30,500 to be divided among the partners using the profit and loss ratio. After the distribution of loss, D's capital account would result to a debit balance of P3,200. Offsetting the entire amount of D's loan account against his capital account still leaves his capital account with a debit balance of P1,200. D has to invest additional cash to fully eliminate his deficiency. Requirement a. Prepare the Statement of Liquidation as of April 26,2016. b. Journal entries required to record the liquidation transactions.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
kindly answer case no. 3.thankyou.
![D, E and F are partners in DEF Partnership. A condensed statement of financial position of the company on April 27,
2016, the day the partners decide to liquidate the business is presented as follows:
DEF Partnership
Statement of Financial Position
April 26, 2016
Assets
P 20,000
80,000
Liabilities
D, Loan
D, capital (40%)
E, capital (40%)
F, capital (20%)
P 28,000
2,000
9,000
21,000
40,000
Cash
Other Assets
Total Assets
P100,000
Total Liabilities and Capital
P 100,000
========
=========
CASE 3: Loss on Realization Resulting Capital Deficiency to a Solvent Partner
Assume that the Other Assets were sold for P49,500, thus, resulting to a loss of P30,500 to be divided among the
partners using the profit and loss ratio. After the distribution of loss, D's capital account would result to a debit
balance
of P3,200. Offsetting the entire amount of D's loan account against his capital account still leaves his capital account
with a debit balance of P1,200. D has to invest additional cash to fully eliminate his deficiency.
Requirement: a. Prepare the Statement of Liquidation as of April 26,2016.
b. Journal entries required to record the liquidation transactions.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F3e6b6a50-7ddf-4af3-a6e8-fa2e3ba021aa%2F572ec098-14c7-4580-8edd-66588a8c5796%2Fkti2608_processed.png&w=3840&q=75)
Transcribed Image Text:D, E and F are partners in DEF Partnership. A condensed statement of financial position of the company on April 27,
2016, the day the partners decide to liquidate the business is presented as follows:
DEF Partnership
Statement of Financial Position
April 26, 2016
Assets
P 20,000
80,000
Liabilities
D, Loan
D, capital (40%)
E, capital (40%)
F, capital (20%)
P 28,000
2,000
9,000
21,000
40,000
Cash
Other Assets
Total Assets
P100,000
Total Liabilities and Capital
P 100,000
========
=========
CASE 3: Loss on Realization Resulting Capital Deficiency to a Solvent Partner
Assume that the Other Assets were sold for P49,500, thus, resulting to a loss of P30,500 to be divided among the
partners using the profit and loss ratio. After the distribution of loss, D's capital account would result to a debit
balance
of P3,200. Offsetting the entire amount of D's loan account against his capital account still leaves his capital account
with a debit balance of P1,200. D has to invest additional cash to fully eliminate his deficiency.
Requirement: a. Prepare the Statement of Liquidation as of April 26,2016.
b. Journal entries required to record the liquidation transactions.
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