The partners of Grafton Company have decided to liquidate their business.Noncash assets were sold for $115,000. The income ratios of the partners KaleD., Croix D., and Marais K. are 2:3:3, respectively. Complete the followingschedule of cash payments for Grafton Company. DO IT! 3a: PartnershipLiquidation No Capital Deficiency (Solution) Gafton Company Schedule of CashPayments \table [[Item, Cash,+, \table[[Noncash], [Assets]],, Liabilities,, \table [[ DO IT! 3a: Partnership Liquidation-No Capital Deficiency (Solution)ItemBalances beforeliquidationSale of noncashassets andallocation of gainNew balancesPay liabilitiesNew balancesCash distribution topartnersFinal balancesCash+10,000 +O+++Gafton CompanySchedule of Cash PaymentsNoncashKale D.,Croix D.,Assets = Liabilities + Capital + Capital +85,000 =O||1111||1140,000 +0++15,000 + 35,000 +0+++O++++Marais K.,Capital5,0000

Partnership liquidation is the process of ending a partnership and distributing its assets.During…

Answered: The partners of Grafton Company have…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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The capital balances and profit and loss ratios in ABC Partnership on December 31 are as follows: Partner Capital Balance Profit and Loss Ratio A. Alpha $72,000 60% B. Bravo $29,650 30% C. Charlie $24,000 10% Charlie is withdrawing from the company. Instructions: Journalize the withdrawal of Charlie under each of the following independent assumptions: a. Using personal funds, Bravo agrees to purchase Charlie's ownership interest for $29,000 cash. b. Charlie is paid $29,000 from partnership assets. c. Charlie is paid $19,100. Round amounts to the nearest dollar. Show ALL calculations for full marks.
RST partnership begins the liquidation process with the following balance sheet and profit and loss percentages Cash 280,000 Liabilities 200,000 Noncash Assets 300,000 R Capital (40%) 100,000 S Capital (30%) 150,000 T Capital (30%) 130,000 Liquidation expenses are estimated at $50,000. Assume any deficit balance in a partner’s capital account will not be repaid. What is the safe payment that can be made to partner T. answer please
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Chen, Korhonen, Lebuca, and Swid are partners who share profits and losses on a 4:3:2:1 basis, respectively. They are beginning to liquidate the business. At the start of this process, capital balances are Chen, capital Korhonen, capital Lebuca, capital Swid, capital $ 60,000 27,000 43,000 20,000 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 $ Chen Korhonen 60,000 $ Lebuca 27,000 $ 43,000 $ Swid 20,000:
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…
The Drysdale, Koufax, and Marichal partnership has the following balance sheet immediately prior to liquidation: Cash Noncash assets Req A1 a-1. Determine the maximum loss that can be absorbed in Step 1. Then, assuming that this loss has been incurred, determine the next maximum loss that can be absorbed in Step 2. a-2. Liquidation expenses are estimated to be $19,000. Prepare a predistribution schedule to guide the distribution of cash. Further, modify the tags in explanation as well. b. Assume that assets costing $78,000 are sold for $62,000. How is the available cash to be divided? Complete this question by entering your answers in the tabs below. Step 1 $ 40,000 224,000 Partner Capital Balance Drysdale Koufax Marichal Determine the maximum loss that can be absorbed in Step 1. Then, assuming that this loss has been incurred, determine the next maximum loss that can be absorbed in Step 2. Step 2 Liabilities Drysdale, loan Drysdale, capital (50%) Koufax, capital (30%) Marichal,…
Chen, Korhonen, Lebuca, and Swid are partners who share profits and losses on a 4:3:2:1 basis, respectively. They are beginning to liquidate the business. At the start of this process, capital balances are Chen, capital Korhonen, capital Lebuca, capital Swid, capital Required: $ 68,000 29,400 51,000 22,400 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 Chen Korhonen Lebuca Swid $ 68,000 $ 29,400 $ 51,000 $ 22,400

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