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Problem 10-21 (Algo) (LO 10-2, 10-3, 10-5) Alex and Bess have been in partnership for many years. The partners, who share profits and losses on a 70:30 basis, respectively, wish to retire and have agreed to liquidate the business. Liquidation expenses are estimated to be $6,000. At the date the partnership ceases operations, the balance sheet is as follows: Cash Noncash assets $ 52,000 110,000 Liabilities Alex, capital Bess, capital Total assets $ 162,000 Total liabilities and capital $ 41,000 77,000 44,000 $ 162,000 Part A: Prepare journal entries for the following transactions that occurred in chronological order: a. Distributed safe cash payments to the partners. b. Paid $24,600 of the partnership's liabilities. c. Sold noncash assets for $121,000. d. Distributed safe cash payments to the partners. e. Paid remaining partnership liabilities of $16,400. f. Paid $4,800 in liquidation expenses; no further expenses will be incurred. g. Distributed remaining cash held by the business to the partners. Part B: Prepare a final statement of partnership liquidation. Required A Required B Prepare a final statement of partnership liquidation. (Amounts to be deducted should be entered in minus sign.) ALEX AND BESS PARTNERSHIP Statement of Partnership Liquidation Beginning balances Distribution to partners Paid liabilities Sold noncash assets Updated balances Distribution to partners Updated balances Paid liabilities Paid liquidation expenses Updated balances Distribution to partners Closing balances Cash Non-cash Assets Liabilities Alex, Capital Bess, Capital

Problem 10-21 (Algo) (LO 10-2, 10-3, 10-5) Alex and Bess have been in partnership for many years. The partners, who share profits and losses on a 70:30 basis, respectively, wish to retire and have agreed to liquidate the business. Liquidation expenses are estimated to be $6,000. At the date the partnership ceases operations, the balance sheet is as follows: Cash Noncash assets $ 52,000 110,000 Liabilities Alex, capital Bess, capital Total assets $ 162,000 Total liabilities and capital $ 41,000 77,000 44,000 $ 162,000 Part A: Prepare journal entries for the following transactions that occurred in chronological order: a. Distributed safe cash payments to the partners. b. Paid $24,600 of the partnership's liabilities. c. Sold noncash assets for $121,000. d. Distributed safe cash payments to the partners. e. Paid remaining partnership liabilities of $16,400. f. Paid $4,800 in liquidation expenses; no further expenses will be incurred. g. Distributed remaining cash held by the business to the partners. Part B: Prepare a final statement of partnership liquidation. Required A Required B Prepare a final statement of partnership liquidation. (Amounts to be deducted should be entered in minus sign.) ALEX AND BESS PARTNERSHIP Statement of Partnership Liquidation Beginning balances Distribution to partners Paid liabilities Sold noncash assets Updated balances Distribution to partners Updated balances Paid liabilities Paid liquidation expenses Updated balances Distribution to partners Closing balances Cash Non-cash Assets Liabilities Alex, Capital Bess, Capital

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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Problem 10-21 (Algo) (LO 10-2, 10-3, 10-5) Alex and Bess have been in partnership for many years. The partners, who share profits and losses on a 70:30 basis, respectively, wish to retire and have agreed to liquidate the business. Liquidation expenses are estimated to be $6,000. At the date the partnership ceases operations, the balance sheet is as follows: Cash Noncash assets $ 52,000 110,000 Liabilities Alex, capital Bess, capital $ 41,000 77,000 44,000 Total assets $ 162,000 Total liabilities and capital $ 162,000 Part A: Prepare journal entries for the following transactions that occurred in chronological order: a. Distributed safe cash payments to the partners. b. Paid $24,600 of the partnership's liabilities. c. Sold noncash assets for $121,000. d. Distributed safe cash payments to the partners. e. Paid remaining partnership liabilities of $16,400. f. Paid $4,800 in liquidation expenses; no further expenses will be incurred. g. Distributed remaining cash held by the business to the partners. Part B: Prepare a final statement of partnership liquidation. Required A Required B Prepare a final statement of partnership liquidation. (Amounts to be deducted should be entered in minus sign.) ALEX AND BESS PARTNERSHIP Statement of Partnership Liquidation Beginning balances Distribution to partners Paid liabilities Sold noncash assets Updated balances Distribution to partners Updated balances Paid liabilities Paid liquidation expenses Updated balances Distribution to partners Closing balances Cash Non-cash Assets Liabilities Alex, Capital Bess, Capital
Transcribed Image Text:Problem 10-21 (Algo) (LO 10-2, 10-3, 10-5) Alex and Bess have been in partnership for many years. The partners, who share profits and losses on a 70:30 basis, respectively, wish to retire and have agreed to liquidate the business. Liquidation expenses are estimated to be $6,000. At the date the partnership ceases operations, the balance sheet is as follows: Cash Noncash assets $ 52,000 110,000 Liabilities Alex, capital Bess, capital $ 41,000 77,000 44,000 Total assets $ 162,000 Total liabilities and capital $ 162,000 Part A: Prepare journal entries for the following transactions that occurred in chronological order: a. Distributed safe cash payments to the partners. b. Paid $24,600 of the partnership's liabilities. c. Sold noncash assets for $121,000. d. Distributed safe cash payments to the partners. e. Paid remaining partnership liabilities of $16,400. f. Paid $4,800 in liquidation expenses; no further expenses will be incurred. g. Distributed remaining cash held by the business to the partners. Part B: Prepare a final statement of partnership liquidation. Required A Required B Prepare a final statement of partnership liquidation. (Amounts to be deducted should be entered in minus sign.) ALEX AND BESS PARTNERSHIP Statement of Partnership Liquidation Beginning balances Distribution to partners Paid liabilities Sold noncash assets Updated balances Distribution to partners Updated balances Paid liabilities Paid liquidation expenses Updated balances Distribution to partners Closing balances Cash Non-cash Assets Liabilities Alex, Capital Bess, Capital
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