Required: Prepare a statement of partnership liquidation to determine the amount of cash that Bell would receive from the sale of partnership assets. Note: Amounts to be deducted should be entered with a minus sign. BELL, HARDY, DENNARD, AND SUDDATH PARTNERSHIP Statement of Partnership Liquidation (Hypothetical) Cash Assets Liabilities Bell, Capital 40% Hardy, Capital 30% Dennard, Capital 20% Suddath, Capital 10% Balances $ 106,000 $ 91,000 $ 12,000 $ 102,000 Sale of assets Subtotal $ 106,000 91,000 12,000 102,000 0 0 0 Pay liabilities Subtotal $ 106,000 $ 91,000 $ 12,000 $ 102,000 $ 0 $ 0 $ 0 Allocate deficit Subtotal $ 106,000 $ 91,000 $ 12,000 $ 102,000 $ 0 $ 0 $ 0 Distribute cash Ending balances $ 106,000 $ 91,000 $ 12,000 $ 102,000 $ 0 $ 0 $ 0

Required: Prepare a statement of partnership liquidation to determine the amount of cash that Bell would receive from the sale of partnership assets. Note: Amounts to be deducted should be entered with a minus sign. BELL, HARDY, DENNARD, AND SUDDATH PARTNERSHIP Statement of Partnership Liquidation (Hypothetical) Cash Assets Liabilities Bell, Capital 40% Hardy, Capital 30% Dennard, Capital 20% Suddath, Capital 10% Balances $ 106,000 $ 91,000 $ 12,000 $ 102,000 Sale of assets Subtotal $ 106,000 91,000 12,000 102,000 0 0 0 Pay liabilities Subtotal $ 106,000 $ 91,000 $ 12,000 $ 102,000 $ 0 $ 0 $ 0 Allocate deficit Subtotal $ 106,000 $ 91,000 $ 12,000 $ 102,000 $ 0 $ 0 $ 0 Distribute cash Ending balances $ 106,000 $ 91,000 $ 12,000 $ 102,000 $ 0 $ 0 $ 0

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

A local partnership was considering the possibility of liquidation since one of the partners (Ding) wasinsolvent. Capital balances at that time were as follows. Profits and losses were divided on a 4:2:2:2basis,respectively. Ding, Capital – P60,000; Laurel, Capital – P67,000; Ezzard, Capital – P17,000; Tillman,Capital – P96,000. Ding’s creditors filed a P25,000 claim against the partnership’s assets. At that time, thepartnership held assets reported at P360,000 and liabilities of P120,000. If the assets could be sold forP228,000 what is the minimum amount that Ding’s creditors would have received? a. P -0-b. P2,500c. P36,000d. P38,250
In 2017, Ryan, Chen and Win established a firm partnership and they agreed to share the profits in a 2:1:1 ratio. In mid-2018, with operations running profitably, they decided to dissolve the firm's partnership. Based on the following facts, prepare a summary of the partner's capital balance showing how much, if any, is available to settle in final settlement. A B Value of net assets paid in to partnership firm... $50,000 $22,500 $20,000 Company partnership net income for 1976 $30,000 divided into Ratio 2:1:1.. $15,000 $7,500 $7,500 1986 private take... $15,000 $10,000 $10,000 Net assets at the time of dissolution are assessed For $65,000 and distributed to $16,250 $16,250 Allies according to a ratio of 2:1:1..... $32,500
A partnership is currently holding $400,000 in assets and $234,000 in liabilities. The partnership is to be liquidated, and $20,000 is the best estimation of the expenses that will be incurred during this process. The four partners share profits and losses as shown. Capital balances at the start of the liquidation follow: Berzina, capital (40%) Horvath, capital (30%) Markov, capital (10%) Petronis, capital (20%) $ 59,000 39,000 34,000 34,000 Required: Prepare a predistribution plan to determine which partner will be the first to receive cash from the liquidation and what amount that partner will receive before other partners receive any cash. Note: Amounts to be deducted should be entered with a minus sign. Beginning balances Assumed loss Balances Assumed loss Balances Assumed loss Balances $ Berzina 147,500 Horvath Markov Petronis
i need the answer quickly
The Field, Brown & Snow are partners and share income and losses equality. The partner decide to liquidate the partnership when their capital balances are as follows: Field, $131,250; Brown, $165,000; and Snow, $153,750. On May 31, the liquidation resulted in a loss of $405,000. 3. Assume that the partner with a deficit does not reimburse the partnership. Prepare journal entries (a) to transfer the deficit to the other partners and (b) to record the final disbursement of cash to the partners.
A partnership is considering possible liquidation because one of the partners (Bell) is personally insolvent. Profits and losses are divided on a 4:3:2:1 basis, respectively. Capital balances at the current time are Bell, capital $ 65,000 Hardy, capital 62,000 Dennard, capital 14,000 Suddath, capital 86,000 Bell’s creditors have filed a $27,000 claim against the partnership’s assets. The partnership currently holds assets of $360,000 and liabilities of $133,000. If the assets can be sold for $220,000, what is the minimum amount that Bell’s creditors would receive?
Following is a series of independent cases. In each situation, indicate the cash distribution to be made to partners at the end of the liquidation process. Unless otherwise stated, assume that all solvent partners will reimburse the partnership for their deficit capital balances. Part A The Buarque, Monte, and Vinicius partnership reports the following accounts. Vinicius is personally insolvent and can contribute only an additional $34,000 to the partnership. Cash $ 155,000 Liabilities 60,000 Monte, loan 70,000 Buarque, capital (50% of profits and losses) 22,000 Monte, capital (25%) 43,000 Vinicius, capital (25%) (40,000 ) (deficit) Part B Drawdy, Langston, and Pearl operate a local accounting firm as a partnership. After working together for several years, they have decided to liquidate the partnership’s property. The partners have prepared the following balance sheet: Cash $ 45,000 Liabilities $ 59,500…
Sarah recently sold her partnership interest for significantly more than her outside basis in the interest. Two separate appraisals were commissioned at the time of the sale to estimate the value of the partnership’s hot assets and other assets. The first appraisal estimates the value of the hot assets at approximately $750,000, while the second appraisal estimates the value of these assets at approximately $500,000. Given that the partnership’s inside basis for its hot assets is $455,000, Sarah intends to use the second appraisal to determine the character of the gain from the sale of her partnership interest. Questions to consider include the following: Is it appropriate for Sarah to ignore the first appraisal when determining her tax liability from the sale of her partnership interest? Which appraisal would you use and why two appraisals could be different? Are there any ethical issues with purposely choosing the lower value? How much discretion does the tax law provide? What are…
After the tangible assets have been adjusted to current market prices, the capital accounts of Grayson Jackson and Harry Barge have balances of $64,900 and $86,500, respectively. Lewan Gorman is to be admitted to the partnership, contributing $43,300 cash to the partnership, for which he is to receive an ownership equity of $50,500. All partners share equally in income. a. Journalize the entry to record the admission of Gorman, who is to receive a bonus of $7,200. If an amount box does not require an entry, leave it blank. Cash Grayson Jackson, Capital Harry Barge, Capital Lewan Gorman, Capital b. What are the capital balances of each partner after the admission of the new partner? Partner Balance Grayson Jackson $ Harry Barge $ Lewan Gorman $
Prior to liquidating their partnership, Craig and Jenny had capital accounts of $60,570 and $116,570, respectively. The partnership assets were sold for $214,550. The partnership had $23,370 of liabilities. Craig and Jenny share income and losses equally. Determine the amount received by Jenny as a final distribution from liquidation of the partnership.
Georgia's Interest in the equal GFH Partnership is liquidated when the GFH Partnership makes a Liquidating Distribution to Georgia and the remaining Partners assume Georgia's share of the Partnership Liabilities. Georgia receives $12,000 in Cash, Accounts Receivable of $21,000 (Fair Market Value) and Equipment worth (Fair Market Value) of $47,000. On the date of the Liquidation, the Partnership's Cash Basis Balance Sheet reflected the following: Cash (Adjusted Basis- $60,000; Fair Market Value - $60,000); Unrealized Receivable (Adjusted Basis-S-0-; Fair Market Value - $63,000); Equipment (Adjusted Basis- $72,000; Fair Market Value - $141,000) (Total Assets: Adjusted Basis- $132,000; Fair Market Value - $264,000); Notes Payable (Adjusted Basis - $24,000; Fair Market Value - $24,000); Capital Accounts: Georgia Capital (Adjusted Basis - $36,000, Fair Market Value - $80,000); Freddie Capital (Adjusted Basis- $36,000; Fair Market Value - $80,000); Helen Capital (Adjusted Basis- $36,000;…