! Required information [The following information applies to the questions displayed below.] The partnership of Butler, Osman, and Ward was formed several years ago as a local tax preparation firm. Two partners have reached retirement age, and the partners have decided to terminate operations and liquidate the business. Liquidation expenses of $47,000 are expected. The partnership balance sheet at the start of liquidation is as follows: Cash Accounts receivable Office equipment (net) Building (net) Land Total assets $ 43,000 73,000 63,000 175,000 165,000 $ 519,000 Liabilities Butler, loan Butler, capital (25%) Osman, capital (25%) Ward, capital (50%) Total liabilities and capital The following transactions transpire in chronological order during the liquidation of the partnership: 1. Collected 90 percent of the accounts receivable and wrote the remainder off as uncollectible. 2. Sold the office equipment for $26,500, the building for $130,000, and the land for $172,000. 3. Distributed safe payments of cash. 4. Paid all liabilities in full. 5. Paid actual liquidation expenses of $36,500 only. 6. Made final cash distributions to the partners. $ 183,000 43,000 115,000 43,000 135,000 $ 519,000 Prepare journal entries to record these liquidation transactions. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)
! Required information [The following information applies to the questions displayed below.] The partnership of Butler, Osman, and Ward was formed several years ago as a local tax preparation firm. Two partners have reached retirement age, and the partners have decided to terminate operations and liquidate the business. Liquidation expenses of $47,000 are expected. The partnership balance sheet at the start of liquidation is as follows: Cash Accounts receivable Office equipment (net) Building (net) Land Total assets $ 43,000 73,000 63,000 175,000 165,000 $ 519,000 Liabilities Butler, loan Butler, capital (25%) Osman, capital (25%) Ward, capital (50%) Total liabilities and capital The following transactions transpire in chronological order during the liquidation of the partnership: 1. Collected 90 percent of the accounts receivable and wrote the remainder off as uncollectible. 2. Sold the office equipment for $26,500, the building for $130,000, and the land for $172,000. 3. Distributed safe payments of cash. 4. Paid all liabilities in full. 5. Paid actual liquidation expenses of $36,500 only. 6. Made final cash distributions to the partners. $ 183,000 43,000 115,000 43,000 135,000 $ 519,000 Prepare journal entries to record these liquidation transactions. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Required information
[The following information applies to the questions displayed below.]
The partnership of Butler, Osman, and Ward was formed several years ago as a local tax preparation firm. Two partners
have reached retirement age, and the partners have decided to terminate operations and liquidate the business.
Liquidation expenses of $47,000 are expected. The partnership balance sheet at the start of liquidation is as follows:
Cash
Accounts receivable
Office equipment (net)
Building (net)
Land
Total assets
$ 43,000
73,000
63,000
175,000
165,000
$ 519,000
Liabilities
Butler, loan
Butler, capital (25%)
Osman, capital (25%)
Ward, capital (50%)
Total liabilities and capital
The following transactions transpire in chronological order during the liquidation of the partnership:
1. Collected 90 percent of the accounts receivable and wrote the remainder off as uncollectible.
2. Sold the office equipment for $26,500, the building for $130,000, and the land for $172,000.
3. Distributed safe payments of cash.
4. Paid all liabilities in full.
5. Paid actual liquidation expenses of $36,500 only.
6. Made final cash distributions to the partners.
$ 183,000
43,000
115,000
43,000
135,000
$ 519,000
Prepare journal entries to record these liquidation transactions. (If no entry is required for a transaction/event, select "No journal
entry required" in the first account field.)](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F37b57dc3-6ce2-496a-8c32-489a3dcf3dd7%2F0d2677b4-0fd3-4da8-80d8-0e562036a50f%2Fhty1xs9_processed.png&w=3840&q=75)
Transcribed Image Text:!
Required information
[The following information applies to the questions displayed below.]
The partnership of Butler, Osman, and Ward was formed several years ago as a local tax preparation firm. Two partners
have reached retirement age, and the partners have decided to terminate operations and liquidate the business.
Liquidation expenses of $47,000 are expected. The partnership balance sheet at the start of liquidation is as follows:
Cash
Accounts receivable
Office equipment (net)
Building (net)
Land
Total assets
$ 43,000
73,000
63,000
175,000
165,000
$ 519,000
Liabilities
Butler, loan
Butler, capital (25%)
Osman, capital (25%)
Ward, capital (50%)
Total liabilities and capital
The following transactions transpire in chronological order during the liquidation of the partnership:
1. Collected 90 percent of the accounts receivable and wrote the remainder off as uncollectible.
2. Sold the office equipment for $26,500, the building for $130,000, and the land for $172,000.
3. Distributed safe payments of cash.
4. Paid all liabilities in full.
5. Paid actual liquidation expenses of $36,500 only.
6. Made final cash distributions to the partners.
$ 183,000
43,000
115,000
43,000
135,000
$ 519,000
Prepare journal entries to record these liquidation transactions. (If no entry is required for a transaction/event, select "No journal
entry required" in the first account field.)
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