The partners of the MKR Partnership agree to liquidate their partnership on December 31, 2020. At that point, the accounting records show the following balances: Account Debit Credit Cash $29,000 Notes Payable $15,000 Accounts Receivable 21,000 Accounts Payable 30,000 Allowance for Doubtful Accounts 2,000 Wages Payable 4,000 Merchandise Inventory 36,000 M. Samuels, Capital 25,000 Equipment 18,000 K. Roswell, Capital 20,000 Accumulated Depreciation-Equipment 7,000 R. Simpson, Capital 1,000 Total $104,000 $104,000 The partners share profits and losses in a 6:3:1 ratio for Samuels, Roswell, and Simpson, respectively. During the process of liquidation, the following transactions were completed in the below sequence: 1. A total of $50,000 cash was received from selling the non-cash assets. 2. Allocate any gain
Partnership Accounting
A partnership is a kind of arrangement between two or more people whereby they agree to manage the business operations and share its profits and losses in an agreed ratio between them. The agreement that is drafted and signed by the partners of the firm is termed as partnership deed and contains various important clauses agreed between the partners such as profit/loss sharing, interest on capital, remuneration allocation of each partner, drawings, admission of a new partner, etc.
Partner Admission and Withdrawal
A partnership is a kind of arrangement between two or more people whereby they agree to manage the business operations and share its profits and losses in an agreed ratio between them. The agreement that is drafted and signed by the partners of the firm is termed as a partnership deed and contains various important clauses agreed between the partners such as profit/loss sharing, interest on capital, remuneration allocation of each partner, drawings of a partner, etc.
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