Joint Arrangement and Corporate Liquidation PROBLEM: Bryan, Ryan, and Yan formed a joint venture in 2010 to sell computers. They assigned Ryan as the manager of the joint venture. They agreed to divide profits equally. They terminated the venture on December 21, 2011, with unsold merchandise. On this date, Ryan's trial balance shows the following account balances before profit distribution: DR CR Joint Venture Cash 90,000 Joint Venture 23,500 Bryan, Capital 32,500 Yan, Capital 15,600 Yan received 6,300 as her share in the joint venture profit. Ryan agreed to be charged for the unsold merchandise as of December 31, 2010. QUESTION: 1. What is the amount due to Bryan upon final settlement?

Joint Arrangement and Corporate Liquidation PROBLEM: Bryan, Ryan, and Yan formed a joint venture in 2010 to sell computers. They assigned Ryan as the manager of the joint venture. They agreed to divide profits equally. They terminated the venture on December 21, 2011, with unsold merchandise. On this date, Ryan's trial balance shows the following account balances before profit distribution: DR CR Joint Venture Cash 90,000 Joint Venture 23,500 Bryan, Capital 32,500 Yan, Capital 15,600 Yan received 6,300 as her share in the joint venture profit. Ryan agreed to be charged for the unsold merchandise as of December 31, 2010. QUESTION: 1. What is the amount due to Bryan upon final settlement?

Financial Reporting, Financial Statement Analysis and Valuation

8th Edition

ISBN:9781285190907

Author:James M. Wahlen, Stephen P. Baginski, Mark Bradshaw

Publisher:James M. Wahlen, Stephen P. Baginski, Mark Bradshaw

Chapter8: Investing Activities

Section: Chapter Questions

Problem 22PC

See similar textbooks

Similar questions

Cheese Partners has decided to close the store. At the date of closing, Cheese Partners had the following account balances: A competitor agrees to buy the inventory and store fixtures for $20,000. Prepare the journal entries detailing the liquidation, assuming that partners Colette and Swarma are sharing profits on a 50:50 basis:
The post closing account balances on December 31, 2011 for the partnership of EGD are as follows: Cash P 390,000 Inventory Accounts Payable E, Capital G, Capital D, Capital 160,000 50,000 150,000 80,000 270,000 Due to unsatisfactory results of operations, the partners decided to liquidate the business. During January, some of the inventory is sold for P100,000. On January 31, 2012 all available cash is distributed. It is doubtful if the remaining inventory items can be sold. How much should each partner receive as settlement?
Cheese Partners has decided to close the store. At the date of closing, Cheese Partners had the following account balances: Capital $8,000 Cash 8,000 Inventory 12,000 Store fixtures 8,000 Accounts payable 22,000 A competitor agrees to buy the inventory and store fixtures for $15,000. 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.
Cheese Partners has decided to close the store. At the date of closing, Cheese Partners had the following account balances: Capital $8,000 Cash 6,000 Inventory 12,000 Store fixtures 8,000 Accounts payable 22,000 A competitor agrees to buy the inventory and store fixtures for $15,000. 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 Cash Loss on Sale Loss on Sale Inventory Inventory Store Fixtures Store Fixtures Colette, Capital Colette, Capital Swarma, Capital Swarma, Capital Loss on Sale Loss on Sale Accounts Payable Accounts Payable Cash Cash Colette, Capital Colette, Capital Swarma, Capital Swarma, Capital Cash Cash
The following balance sheet summary, together with residual profit-sharing ratios, was developed on April 1, 2011, when the Dazzle, Enigma, and Faceless partnership began its liquidation: Cash P140,000 Liabilities P 60,000 Accounts receivable 60,000 Loan from Enigma 20,000 Inventories 85,000 Dazzle capital (20%) 75,000 Plant assets—net 200,000 Enigma capital (40%) 200,000 Loan to Dazzle 25,000 Faceless capital (40%) 155,000 P510,000 P510,000 If available cash except for a $5,000 contingency fund is distributed immediately, Dazzle, Enigma, and Faceless, respectively, should receive:PLEASE DON'T COPY SOLUTION FROM CHEGG a. P10,000, P60,000, and P15,000b. P0, P70,000, and P5,000
The following balance sheet summary, together with residual profit-sharing ratios, was developed on April 1, 2011, when the Dazzle, Enigma, and Faceless partnership began its liquidation: Cash P140,000 Liabilities P 60,000 Accounts receivable 60,000 Loan from Enigma 20,000 Inventories 85,000 Dazzle capital (20%) 75,000 Plant assets—net 200,000 Enigma capital (40%) 200,000 Loan to Dazzle 25,000 Faceless capital (40%) 155,000 P510,000 P510,000 If available cash except for a $5,000 contingency fund is distributed immediately, Dazzle, Enigma, and Faceless, respectively, should receive: a. P10,000, P60,000, and P15,000b. P0, P70,000, and P5,000
Cheese Partners has decided to close the store. At the date of dosing, Cheese Partners had the following account balances: Capital 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
On August 1, 2017, prior to the admission of Grant, E and F Enterprises have the following account balances: P 30,000 400,000 36,000 110,000 134,000 38,000 300,000 300,000 Cash Accounts Receivable Allowance for Bad Debts Merchandise Inventory Equipment - net Accounts Payable Erving, Capital Fisher, Capital Erving and Fisher share profit and loss on 1:1 ratio. Before the admission of Grant, the partners agree on the following adjustments to bring the assets and liabilities to their fair values: The allowance for Bad Debts should be brought to 10% of the outstanding accounts receivable. a. b. The current market value of the merchandise inventory is P 140,000. C. Accrued expenses of P 4,000 should be recognized in the accounting records. If Grant purchases 50% of Erving's capital at its adjusted carrying valur 12/15 much is the total assets of the partnership just after the admission of 1. If Grant is admitted into the partnership upon his investment of P 400,000 for 2/5 interest in…
ABC partnership whose owners consist Ateng, Bagio and Cecep share profits with a ratio of 5: 3: 2. On May 31, 2018 The Fellowship was liquidated. Statement of financial position ahead of liquidation as follows: Equipment Accumulated Depreciation Inventory Account Receivable Cash Total ABC Firm Financial Position Statement May 31 2018 (in $) 42,000 Ateng, Capital (11,000) Bagio, Capital 99,000 Cecep, Capital 44,000 Liability 25,000 199,000 Total 50,000 30,000 20,000 99,000 Cash is used for payment of obligations and the remainder distributed to allies on each end of the month except $3,000 just in case. . If there are allies who have a capital deficit assumed t is capable of paying Non-cash realization as follows: a. June: equipment whose acquisition price is $ 22,000 and book value is $ 16,000 is sold with price $ 12,000. Inventory whose acquisition price is $ 50,000 is sold for $ 35,000 c. September: remaining inventory sold for $ 30,000; paid load liquidation $5,000 199,000 b.…
XYZ Partnership begins the liquidation process with the following balance sheet and profit and loss percentages: Cash 280,000 Noncash Assets 300,000 Liabilities 200,000 X Capital (40%) 100,000 Y Capital (30%) 150,000 Z Capital (30%) 130,000 Liquidation expenses are estimated at $50,000. Assume any deficit in a partner’s capital balance will not be repaid. How much is the safe payment that can be made to partner Z (hint: prepare a proposed schedule of liquidation). a. $0 b. $15,000 This is the ans c. $25,000 d. $10,000 i got this e. $5,000
2. The sale of the non-cash assets resulted in a total loss ofA. P70,000b. P60,000c.P65,000 d. P80.000e. answer not given
Apple, Banana, and Pear partnership began the liquidation process with the following balance sheet (profit and loss sharing percentages are in parenthesis): Cash $30,000 Liabilities $150,000 Noncash Assets $400,000 Apple Capital $100,000 (30%) Banana Capital $ 60,000 (20%) Pear Capital $120,000 (50%) A. If the noncash assets are sold for $250,000 what amount of the loss will be allocated to Apple? B. If the noncash assets are sold for only $100,000 which partner(s) capital accounts will be in a deficit balance and require a contribution of assets to the partnership? Answer a and b both, please.