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Installment Liquidation

Installment Liquidation

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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Requirement: Prepare statement of liquidation 

Installment Liquidation Espeleta and De Guia decided to dissolve and liquidate Espeleta and De Guia on Sept. 23, 2019. On that date, the statement of financial position of the partnership is as follows: Espeleta and De Guia Statement of Financial Position Sept. 23, 2019 Assets Liabilities and Partners' Capital Cash P 5,000 P 15,000 Accounts Payable-Trade Loan Payable-De Guia Espeleta, Capital De Guia, Capital Other Assets 100,000 10,000 60,000 20,000 P105,000 Total P105,000 Total On Sept. 23, 2019, non-cash assets with a carrying amount of P70,000 realized P60.000. and P64.000 was paid to creditors and partners, P1,000 being retained to cover possible liquidation costs. On Oct. 1, 2019, the remaining non-cash assets realized P18.000 (net of liquidation costs), and all available cash was distributed to partners. Espeleta and De Guia share profits and losses 40% and 60%, respectively.
Transcribed Image Text:Installment Liquidation Espeleta and De Guia decided to dissolve and liquidate Espeleta and De Guia on Sept. 23, 2019. On that date, the statement of financial position of the partnership is as follows: Espeleta and De Guia Statement of Financial Position Sept. 23, 2019 Assets Liabilities and Partners' Capital Cash P 5,000 P 15,000 Accounts Payable-Trade Loan Payable-De Guia Espeleta, Capital De Guia, Capital Other Assets 100,000 10,000 60,000 20,000 P105,000 Total P105,000 Total On Sept. 23, 2019, non-cash assets with a carrying amount of P70,000 realized P60.000. and P64.000 was paid to creditors and partners, P1,000 being retained to cover possible liquidation costs. On Oct. 1, 2019, the remaining non-cash assets realized P18.000 (net of liquidation costs), and all available cash was distributed to partners. Espeleta and De Guia share profits and losses 40% and 60%, respectively.
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