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Develop a cash distribution schedule and show the journal entry for each step in the liquidation process.

Develop a cash distribution schedule and show the journal entry for each step in the liquidation process.

FINANCIAL ACCOUNTING
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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On December 31m 3013 The Candy Company has $45,000 in cash, noncash assets of $120,000, liabilities of $50,000. The capital balances of the two partners are Tootsie $70,000 and Reeses $45,000. The firm is liquidated, and $120,000 is received for the noncash assets. Tootsie and Reeses income ratios are 70% and 30%, respectively. Instructions: Develop a cash distribution schedule and show the journal entry for each step in the liquidation process.
Transcribed Image Text:On December 31m 3013 The Candy Company has $45,000 in cash, noncash assets of $120,000, liabilities of $50,000. The capital balances of the two partners are Tootsie $70,000 and Reeses $45,000. The firm is liquidated, and $120,000 is received for the noncash assets. Tootsie and Reeses income ratios are 70% and 30%, respectively. Instructions: Develop a cash distribution schedule and show the journal entry for each step in the liquidation process.
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