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Martha Wheaton, Bess Chen, and Sam Smith were partners in an urban Calgary tea shop called Wake and showed the following account balances as of December 31, 2023: Account balances December 31, 2023 Due to difficulties, the partners decided to liquidate the partnership. The land and building were sold for $700,000 on January 1, 2024. The partners share any profit (loss) in the ratio of 2:1:1 for Wheaton, Chen, and Smith, respectively. Account balances December 31, 2023 Sale of land and building Balance Payment of liabilities Balance Accum. Deprec. Building Accounts Payable Cash Building Land $191,000 $838,000 $487,000 $215,000 $135,000 Required: Complete the schedule. Prepare the entry to distribute the remaining cash to the partners assuming any deficiencies are paid by the partners. (Negative answers should be indicated by a minus sign.) Absorption of deficiency Balance Accum. Deprec. Building $191,000 $ 838,000 $ 487,000 $ 215,000 $ Cash Building $191,000 $ 838,000 $ Land $191,000 $ 838,000 $ 487,000 $ 215,000 $ 487,000 $ Accounts Payable 215,000 $ $191,000 $ 838,000 $ 487,000 $ 215,000 $ Martha Bess Sam Chen, Wheaton, Capital Smith, Capital Capital $330,000 $(59,000) $351,000 Martha Wheaton, Capital 135,000 $ 135,000 $ 135,000 $ 330,000 $ 330,000 $ Bess Chen, Capital (59,000) $ (59,000) $ 330,000 $ 135,000 $ (59,000) $ Sam Smith, Capital 351,000 351,000 351,000 330,000 $ (59,000) $ 351,000

Martha Wheaton, Bess Chen, and Sam Smith were partners in an urban Calgary tea shop called Wake and showed the following account balances as of December 31, 2023: Account balances December 31, 2023 Due to difficulties, the partners decided to liquidate the partnership. The land and building were sold for $700,000 on January 1, 2024. The partners share any profit (loss) in the ratio of 2:1:1 for Wheaton, Chen, and Smith, respectively. Account balances December 31, 2023 Sale of land and building Balance Payment of liabilities Balance Accum. Deprec. Building Accounts Payable Cash Building Land $191,000 $838,000 $487,000 $215,000 $135,000 Required: Complete the schedule. Prepare the entry to distribute the remaining cash to the partners assuming any deficiencies are paid by the partners. (Negative answers should be indicated by a minus sign.) Absorption of deficiency Balance Accum. Deprec. Building $191,000 $ 838,000 $ 487,000 $ 215,000 $ Cash Building $191,000 $ 838,000 $ Land $191,000 $ 838,000 $ 487,000 $ 215,000 $ 487,000 $ Accounts Payable 215,000 $ $191,000 $ 838,000 $ 487,000 $ 215,000 $ Martha Bess Sam Chen, Wheaton, Capital Smith, Capital Capital $330,000 $(59,000) $351,000 Martha Wheaton, Capital 135,000 $ 135,000 $ 135,000 $ 330,000 $ 330,000 $ Bess Chen, Capital (59,000) $ (59,000) $ 330,000 $ 135,000 $ (59,000) $ Sam Smith, Capital 351,000 351,000 351,000 330,000 $ (59,000) $ 351,000

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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Martha Wheaton, Bess Chen, and Sam Smith were partners in an urban Calgary tea shop called Wake and showed the following account balances as of December 31, 2023: Account balances December 31, 2023 Due to difficulties, the partners decided to liquidate the partnership. The land and building were sold for $700,000 on January 1, 2024. The partners share any profit (loss) in the ratio of 2:1:1 for Wheaton, Chen, and Smith, respectively. Required: Complete the schedule. Prepare the entry to distribute the remaining cash to the partners assuming any deficiencies are paid by the partners. (Negative answers should be indicated by a minus sign.) Account balances December 31, 2023 Sale of land and building. Balance Payment of liabilities Balance Martha Accum. Deprec. Building Bess Chen, Wheaton, Accounts Payable Sam Smith, Capital Land Capital Capital Cash Building $191,000 $838,000 $487,000 $215,000 $135,000 $330,000 $(59,000) $351,000 Absorption of deficiency Balance Accum. Building Deprec. Building $191,000 $838,000 $ 487,000 $215,000 $ Cash $191,000 $ 838,000 $ $191,000 $ 838,000 487,000 $ Land Accounts Payable $191,000 $ 838,000 $ 487,000 $ 215,000 $ $ 215,000 $ 487,000 $ 215,000 $ 135,000 $ Martha Wheaton, 135,000 $ 135,000 $ 135,000 $ Capital 330,000 $ 330,000 $ 330,000 $ 330,000 $ Bess Chen, Capital (59,000) $ Sam Smith, Capital 351,000 (59,000) $ 351,000 (59,000) $ 351,000 (59,000) $ 351,000
Transcribed Image Text:Martha Wheaton, Bess Chen, and Sam Smith were partners in an urban Calgary tea shop called Wake and showed the following account balances as of December 31, 2023: Account balances December 31, 2023 Due to difficulties, the partners decided to liquidate the partnership. The land and building were sold for $700,000 on January 1, 2024. The partners share any profit (loss) in the ratio of 2:1:1 for Wheaton, Chen, and Smith, respectively. Required: Complete the schedule. Prepare the entry to distribute the remaining cash to the partners assuming any deficiencies are paid by the partners. (Negative answers should be indicated by a minus sign.) Account balances December 31, 2023 Sale of land and building. Balance Payment of liabilities Balance Martha Accum. Deprec. Building Bess Chen, Wheaton, Accounts Payable Sam Smith, Capital Land Capital Capital Cash Building $191,000 $838,000 $487,000 $215,000 $135,000 $330,000 $(59,000) $351,000 Absorption of deficiency Balance Accum. Building Deprec. Building $191,000 $838,000 $ 487,000 $215,000 $ Cash $191,000 $ 838,000 $ $191,000 $ 838,000 487,000 $ Land Accounts Payable $191,000 $ 838,000 $ 487,000 $ 215,000 $ $ 215,000 $ 487,000 $ 215,000 $ 135,000 $ Martha Wheaton, 135,000 $ 135,000 $ 135,000 $ Capital 330,000 $ 330,000 $ 330,000 $ 330,000 $ Bess Chen, Capital (59,000) $ Sam Smith, Capital 351,000 (59,000) $ 351,000 (59,000) $ 351,000 (59,000) $ 351,000
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