Problem #5 Lump-Sum Liquidation Escareal, Acosta, and Lopez are liquidating their business. They sl in a 2:3:1 ratio, respectively, and currently have capital balances c and P390,000, respectively. In addition, the partnership has P150 in accounts payable, and P1,000,000 in noncash assets. personally solvent, but Acosta is not. Assuming that the nonca P460,000, prepare the liquidation journal entries. Esc

Problem #5 Lump-Sum Liquidation Escareal, Acosta, and Lopez are liquidating their business. They sl in a 2:3:1 ratio, respectively, and currently have capital balances c and P390,000, respectively. In addition, the partnership has P150 in accounts payable, and P1,000,000 in noncash assets. personally solvent, but Acosta is not. Assuming that the nonca P460,000, prepare the liquidation journal entries. Esc

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 3 low is the balance sheet of Gold Ace Company immediately prior to the liquidation of the partnership: P500,000.00 1,900,000.00 P2,400,000.00 Cash Non-cash assets Total P1,100,000.00 Liabilities Capital Salazar Nenubla Gomez 480,000 00 320,000.00 500,000.00 P2,400,000.00 Total The partners share profits and losses in the ratio 50%, 30%, 20%. It is assumed that Salazar and Gomez have personal assets which are sufficient in amount to "make good" capital debit balances which may be created during the liquidation process. The non-cash assets of the partnership are realized in the amount of P600,000,00. Give the schedule of liquidation and the corresponding journal entries assuming a) nothing is realized from the three partners, b) capital deficiencies are paid.
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44 If all the partners are insolvent and the non-cash assets were sold at P 10,000, what is the entry to eliminate the capital deficiency in the capital deficient partner? ABC Partnership have the following balances before liquidation: 250,000 500,000 Accounts payable A,loan A, Capital (40%) B, Capital (45%) C, Capital (15%). 50,000 10,000 190,000 350,000 150,000 Cash Non-cash assets O Debit A loan 6,000 Credit A,Capital 6,000 Debit Aloan 10,000 Credit A, Capital 10,000 Deoit B Capital 4.500 and C. Capital 1.500: Credit A Capital 6,000 ODebt A Capits 6000: Credit B Capital 4500 andc Cap ta 1,500
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
Problem III The following are the capital balances and share in each profit of Ring Partnership: Aragorn 300 50% Legolas 200 30% Gimli 200 20% 13. If the partnership was liquidated and P50 is ready for distribution, how much will Gimli received?
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