The partners in Crawford Company decide to liquidate the firm when the balance sheet shows the following. Crawford Company Balance Sheet May 31, 2020 Assets Liabilities and Owners' Equity Cash $ 27,500 Notes payable $ 13,500 Accounts receivable 25,000 Accounts payable 27,000 Allowance for doubtful accounts (1,000) Salaries and wages payable 4,000 Inventory 34,500 A. Jamison, capital 30,000 Equipment 21,000 S. Moyer, capital 21,000 Accumulated depreciation—equipment (5,500) P. Roper, capital 6,000 $101,500 $101,500 The partners share income and loss 5:3:2. During the process of liquidation, the following transactions were completed in the following sequence. 1. A total of $51,000 was received from converting noncash assets into cash. 2. Gain or loss on realization was allocated to partners. 3. Liabilities were paid in full. 4. Cash was distributed to the partners Instructions a. Prepare a schedule of liquidation for the partnership b. Prepare the entries to record the transactions
The partners in Crawford Company decide to liquidate the firm when the balance sheet shows the following.
Crawford Company
Balance Sheet
May 31, 2020
Assets Liabilities and Owners' Equity
Cash $ 27,500 Notes payable $ 13,500
Accounts receivable 25,000 Accounts payable 27,000
Allowance for doubtful accounts (1,000) Salaries and wages payable 4,000
Inventory 34,500 A. Jamison, capital 30,000
Equipment 21,000 S. Moyer, capital 21,000
Accumulated depreciation—equipment (5,500) P. Roper, capital 6,000
$101,500 $101,500
The partners share income and loss 5:3:2. During the process of liquidation, the following transactions were completed in the following sequence.
1. A total of $51,000 was received from converting noncash assets into cash.
2. Gain or loss on realization was allocated to partners.
3. Liabilities were paid in full.
4. Cash was distributed to the partners
Instructions
a. Prepare a schedule of liquidation for the
b. Prepare the entries to record the transactions
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