Problem #16 Installment Liquidation: Schedule of Safe Payments The statement of financial position for Paraiso and Ligeralde Partnership on June 1, 2019 before liquidation is as follows: Assets Liabilities & Capital Cash P 50,000 Liabilities P 200,000 225,000 Paraiso, capital Ligeralde, capital Total Liabilities & Capital Other Assets 550,000 175,000 P 600,000 Total Assets P 600,000 Partners Paraiso and Ligeralde share profits and losses 60:40, respectively. In June, assets with a book value of P220,000 were sold for P180,000, creditors were paid in full, and P20,000 was paid to partners. In July, assets with book value of P100,000 were sold for P120,000, liquidation expenses of P5,000 were paid and cash of P125,000 was paid to partners. In August, the remaining assets were sold for P225,000. Required: 1. How much cash should Ligeralde receive in June? 2. How much cash should Paraiso receive in July? 3. How much cash should Ligeralde and Paraiso receive in August?
Problem #16 Installment Liquidation: Schedule of Safe Payments The statement of financial position for Paraiso and Ligeralde Partnership on June 1, 2019 before liquidation is as follows: Assets Liabilities & Capital Cash P 50,000 Liabilities P 200,000 225,000 Paraiso, capital Ligeralde, capital Total Liabilities & Capital Other Assets 550,000 175,000 P 600,000 Total Assets P 600,000 Partners Paraiso and Ligeralde share profits and losses 60:40, respectively. In June, assets with a book value of P220,000 were sold for P180,000, creditors were paid in full, and P20,000 was paid to partners. In July, assets with book value of P100,000 were sold for P120,000, liquidation expenses of P5,000 were paid and cash of P125,000 was paid to partners. In August, the remaining assets were sold for P225,000. Required: 1. How much cash should Ligeralde receive in June? 2. How much cash should Paraiso receive in July? 3. How much cash should Ligeralde and Paraiso receive in August?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Partnership Accounting
A partnership is a kind of arrangement between two or more people whereby they agree to manage the business operations and share its profits and losses in an agreed ratio between them. The agreement that is drafted and signed by the partners of the firm is termed as partnership deed and contains various important clauses agreed between the partners such as profit/loss sharing, interest on capital, remuneration allocation of each partner, drawings, admission of a new partner, etc.
Partner Admission and Withdrawal
A partnership is a kind of arrangement between two or more people whereby they agree to manage the business operations and share its profits and losses in an agreed ratio between them. The agreement that is drafted and signed by the partners of the firm is termed as a partnership deed and contains various important clauses agreed between the partners such as profit/loss sharing, interest on capital, remuneration allocation of each partner, drawings of a partner, etc.
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Transcribed Image Text:Problem #16
Installment Liquidation: Schedule of Safe Payments
The statement of financial position for Paraiso and Ligeralde Partnership on June 1, 2019
before liquidation is as follows:
Assets
Liabilities & Capital
P 50,000
550,000
Cash
Liabilities
P 200,000
Other Assets
Paraiso, capital
Ligeralde, capital
Total Liabilities & Capital
225,000
175,000
P 600,000
Total Assets
P 600,000
Partners Paraiso and Ligeralde share profits and losses 60:40, respectively. In June,
assets with a book value of P220,000 were sold for P180,000, creditors were paid in full,
and P20,000 was paid to partners. In July, assets with book value of P100,000 were sold
for P120,000, liquidation expenses of P5,000 were paid and cash of P125,000 was paid
to partners. In August, the remaining assets were sold for P225,000.
Required:
1. How much cash should Ligeralde receive in June?
2. How much cash should Paraiso receive in July?
3. How much cash should Ligeralde and Paraiso receive in August?
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