Required; Prepare a statement of partnership liquidation and the entries to record the following: 1. Sale of all non-cash assets. 2. Distribution of loss on realization to the partners. 3. Payment of the liabilities. 4. Distribution of cash to the partners.
Required; Prepare a statement of partnership liquidation and the entries to record the following: 1. Sale of all non-cash assets. 2. Distribution of loss on realization to the partners. 3. Payment of the liabilities. 4. Distribution of cash to the partners.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Problem #2
Lump-Sum Liquidation with Loss on Realization
After several years of operations, the partnership of Miranda, Leon and Estoque is to be
liquidated. After making the closing entries on March 31, 2019 the following accounts
remained open:
Account Balance
Credit
Account Title
Debit
P 150,000
2,600,000
Cash
Other Assets
P 750,000
400,000
600,000
Liabilities
Miranda, Capital
Leon, Capital
Estoque, Capital
1,000,000
The non-cash assets are sold for P2,150,000. Profits and losses are shared equally.
Required;
Prepare a statement of partnership liquidation and the entries to record the following:
1. Sale of all non-cash assets.
2. Distribution of loss on realization to the partners.
3. Payment of the liabilities.
4. Distribution of cash to the partners.
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