PROBLEM 10-5 Trustee Accounting and Combining Workpaper L01Plum Company has been in receivership for the past five months. At the beginning of thisperiod, the following trial balance was taken from Plum Company's books.CashAccounts Receivable$ 4,50015,000InventoryProperty and Equipment142,65090,600$252,750$ 3,75036,825143,175135,000Allowance for UncollectiblesAccumulated DepreciationAccounts PayableCapital StockRetained Earnings (deficit)(66,000)$252,750The trustee, P. Smith, who was appointed to manage the debtor's business during the periodof liquidation, opened a new set of books and took title to Plum Company's assets on June 1,2012. The activities of the trustee during the five-month period ended October 31, 2012, areas follows:1. The trustee sold all Plum Company's inventory for $153,000, of which $75,000 representedcredit sales.2. Cash was collected on old receivables, $11,250, and on new receivables, $64,500.3. Expenses paid during the period wereOperating expensesTrustee expenses$11,8503,0004. The trustee recorded depreciation expense of $5,250.5. The trustee paid off all the accounts payable.6. Estimated uncollectibles on the new accounts receivable were $2,250; the trustee wroteoff all the remaining old accounts receivable.7. The trustee sold all the property and equipment for $43,500.Required:A. Prepare journal entries to record the effects of these transactions on the books of boththe trustee and Plum Company.B. Prepare a combining workpaper at the end of the five-month period, October 31, 2012.

Name: PROBLEM 10-5 Trustee Accounting and Combining Workpaper L01Plum Compa
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Description: PROBLEM 10-5 Trustee Accounting and Combining Workpaper L01Plum Company has been in receivership for the past five months. At the beginning of thisperiod, the following trial balance was taken from Plum Company's books.CashAccounts Receivable$ 4,500

Explanation: Refer to the journal entries

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Accounting

Plum Company has been in receivership for the past five months. At the beginning of thi period, the following trial balance was taken from Plum Company's books. Cash $ 4,500 15,000 Accounts Receivable Inventory Property and Equipment 142,650 90,600 $252,750 $ 3,750 36,825 143,175 Allowance for Uncollectibles Accumulated Depreciation Accounts Payable

Plum Company has been in receivership for the past five months. At the beginning of thi period, the following trial balance was taken from Plum Company's books. Cash $ 4,500 15,000 Accounts Receivable Inventory Property and Equipment 142,650 90,600 $252,750 $ 3,750 36,825 143,175 Allowance for Uncollectibles Accumulated Depreciation Accounts Payable

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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