The General Meeting of shareholders decides on the dissolution and liquidation of the company and approves the initial liquidation balance sheet. In the company, A holds 60% and B holds 40% Assets Plots of land: €30,000 Machinery: €90,000 -Accumulated depreciation: -€50,000 Net value of machinery: €40,000 Customers: €87,000 Cash available: €273,000 Total assets: €430,000 Liabilities Share capital: €120,000 Statutory reserve: €15,000 Suppliers: €70,000 Tax liabilities: €60,000 Social security organizations: €165,000 Total liabilities: €430,000 The liquidator performed the following actions: From the customers, €27,000 concerns companies that have gone bankrupt without the possibility of collecting the receivables, while the remaining amount is collected normally. The plots of land are sold for €35,000. The machinery is sold for €100,000. All liabilities are paid in full. The remaining amount is distributed to the shareholders. Required: Journal entries
The General Meeting of shareholders decides on the dissolution and liquidation of the company and approves the initial liquidation balance sheet. In the company, A holds 60% and B holds 40% Assets Plots of land: €30,000 Machinery: €90,000 -Accumulated depreciation: -€50,000 Net value of machinery: €40,000 Customers: €87,000 Cash available: €273,000 Total assets: €430,000 Liabilities Share capital: €120,000 Statutory reserve: €15,000 Suppliers: €70,000 Tax liabilities: €60,000 Social security organizations: €165,000 Total liabilities: €430,000 The liquidator performed the following actions: From the customers, €27,000 concerns companies that have gone bankrupt without the possibility of collecting the receivables, while the remaining amount is collected normally. The plots of land are sold for €35,000. The machinery is sold for €100,000. All liabilities are paid in full. The remaining amount is distributed to the shareholders. Required: Journal entries
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
The General Meeting of shareholders decides on the dissolution and liquidation of the company and approves the initial liquidation
Assets
- Plots of land: €30,000
- Machinery: €90,000
- -
Accumulated depreciation : -€50,000 - Net value of machinery: €40,000
- Customers: €87,000
- Cash available: €273,000
- Total assets: €430,000
Liabilities
- Share capital: €120,000
- Statutory reserve: €15,000
- Suppliers: €70,000
- Tax liabilities: €60,000
- Social security organizations: €165,000
- Total liabilities: €430,000
The liquidator performed the following actions:
- From the customers, €27,000 concerns companies that have gone bankrupt without the possibility of collecting the receivables, while the remaining amount is collected normally.
- The plots of land are sold for €35,000.
- The machinery is sold for €100,000.
- All liabilities are paid in full.
- The remaining amount is distributed to the shareholders.
Required:
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