Bundle: Accounting, Loose-Leaf Version, 26th + CengageNOWv2, 2 term Printed Access Card
26th Edition
ISBN: 9781305617063
Author: Carl Warren, Jim Reeve, Jonathan Duchac
Publisher: Cengage Learning
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Question
Chapter 12, Problem 12.25EX
a.
To determine
Limited Liability Company
It is that form of organization which is formed as a legal entity that provides limited liability to the owners. It has a common seal.
To prepare: The statement of LLC liquidation
b.
To determine
To record: The
c.
To determine
To explain: The role of the income and loss sharing ratio in liquidating an LLC.
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Statement of LLC Liquidation
Lester, Torres, and Hearst are members of Arcadia Sales, LLC, sharing income and losses in the ratio of 2:2:1, respectively. The members decide to liquidate the limited liability company. The members' equity prior to liquidation and asset realization on August 1 are as follows:
Lester
$16,000
Torres
37,100
Hearst
23,000
Total
$76,100
In winding up operations during the month of August, noncash assets with a book value of $100,200 are sold for $124,200, and liabilities of $33,200 are satisfied. Prior to realization, Arcadia Sales has a cash balance of $9,100.
a. Prepare a statement of LLC liquidation. Enter any subtractions (balance deficiencies, payments, cash distributions, divisions of loss, sale of assets) as negative numbers using a minus sign. If an amount is zero, enter "o".
Arcadia Sales, LLC
Statement of LLC Liquidation
For the Period August 1-31
Member
Member
Member
Equity
Equity
Equity
Noncash
Lester (2/5) + Torres (2/5) + Hearst (1/5)
Cash +…
Statement of LLC Liquidation
Lester, Torres, and Hearst are members of Arcadia Sales, LLC, sharing income and losses in the ratio of 2:2:1, respectively. The members decide to liquidate the limited liability company. The members' equity prior to liquidation and asset realization on August 1 are as follows:
Lester
$28,100
Torres
65,000
Hearst
40,400
Total
$133,500
In winding up operations during the month of August, noncash assets with a book value of $175,800 are sold for $218,000, and liabilities of $56,500 are satisfied. Prior to realization, Arcadia Sales has a cash balance of $14,200.
a. Prepare a statement of LLC liquidation. Enter any subtractions (balance deficiencies, payments, cash distributions, divisions of loss, sale of assets) as negative numbers using a minus sign. If an amount is zero, enter "0".
Arcadia Sales, LLC
Statement of LLC Liquidation
For the Period August 1-31
Cash +
NoncashAssets =
Liabilities +
MemberEquityLester (2/5) +…
Statement of LLC Liquidation
Lester, Torres, and Hearst are members of Arcadia Sales, LLC, sharing income and losses in the ratio of 2:2:1, respectively. The members decide to liquidate the limited liability company. The members' equity prior to liquidation and asset realization on August 1 are as follows:
Lester
$28,100
Torres
65,000
Hearst
40,400
Total
$133,500
In winding up operations during the month of August, noncash assets with a book value of $175,800 are sold for $218,000, and liabilities of $56,500 are satisfied. Prior to realization, Arcadia Sales has a cash balance of $14,200.
a. Prepare a statement of LLC liquidation. Enter any subtractions (balance deficiencies, payments, cash distributions, divisions of loss, sale of assets) as negative numbers using a minus sign. If an amount is zero, enter "0".
Arcadia Sales, LLC
Statement of LLC Liquidation
For the Period August 1-31
Cash +
NoncashAssets =
Liabilities +
MemberEquityLester (2/5) +…
Chapter 12 Solutions
Bundle: Accounting, Loose-Leaf Version, 26th + CengageNOWv2, 2 term Printed Access Card
Ch. 12 - Prob. 1DQCh. 12 - Prob. 2DQCh. 12 - Prob. 3DQCh. 12 - Prob. 4DQCh. 12 - Prob. 5DQCh. 12 - Prob. 6DQCh. 12 - Prob. 7DQCh. 12 - Prob. 8DQCh. 12 - Prob. 9DQCh. 12 - Prob. 10DQ
Ch. 12 - Prob. 12.1APECh. 12 - Prob. 12.1BPECh. 12 - Prob. 12.2APECh. 12 - Prob. 12.2BPECh. 12 - Prob. 12.3APECh. 12 - Prob. 12.3BPECh. 12 - Prob. 12.4APECh. 12 - Prob. 12.4BPECh. 12 - Prob. 12.5APECh. 12 - Prob. 12.5BPECh. 12 - Prob. 12.6APECh. 12 - Prob. 12.6BPECh. 12 - Prob. 12.7APECh. 12 - Prob. 12.7BPECh. 12 - Prob. 12.1EXCh. 12 - Prob. 12.2EXCh. 12 - Prob. 12.3EXCh. 12 - Prob. 12.4EXCh. 12 - Prob. 12.5EXCh. 12 - Prob. 12.6EXCh. 12 - Prob. 12.7EXCh. 12 - Prob. 12.8EXCh. 12 - Prob. 12.9EXCh. 12 - Prob. 12.10EXCh. 12 - Prob. 12.11EXCh. 12 - Prob. 12.12EXCh. 12 - Prob. 12.13EXCh. 12 - Prob. 12.14EXCh. 12 - Prob. 12.15EXCh. 12 - Prob. 12.16EXCh. 12 - Prob. 12.17EXCh. 12 - Statement of members equity, admitting new member...Ch. 12 - Distribution of cash upon liquidation Hewitt and...Ch. 12 - Distribution of cash upon liquidation David Oliver...Ch. 12 - Prob. 12.21EXCh. 12 - Prob. 12.22EXCh. 12 - Liquidating partnershipscapital deficiency...Ch. 12 - Prob. 12.24EXCh. 12 - Prob. 12.25EXCh. 12 - Prob. 12.26EXCh. 12 - Prob. 12.27EXCh. 12 - Prob. 12.28EXCh. 12 - Prob. 12.1APRCh. 12 - Prob. 12.2APRCh. 12 - Prob. 12.3APRCh. 12 - Prob. 12.4APRCh. 12 - Prob. 12.5APRCh. 12 - Prob. 12.6APRCh. 12 - Prob. 12.1BPRCh. 12 - Prob. 12.2BPRCh. 12 - Prob. 12.3BPRCh. 12 - Prob. 12.4BPRCh. 12 - Prob. 12.5BPRCh. 12 - Statement of partnership liquidation On August 3,...Ch. 12 - Prob. 12.1CPCh. 12 - Prob. 12.2CPCh. 12 - Revenue per employee The following table shows key...Ch. 12 - Prob. 12.4CP
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- Lester, Torres, and Hearst are members of Arcadia Sales, LLC, sharing income and losses in the ratio of 2:2:1, respectively. The members decide to liquidate the limited liability company. The members’ equity prior to liquidation and asset realization on August 1 are as follows: Lester $ 49,000 Torres 61,000 Hearst 27,000 Total $137,000In winding up operations during the month of August, noncash assets with a book value of $146,000 are sold for $158,000, and liabilities of $35,000 are satisfied. Prior to realization, Arcadia Sales has a cash balance of $26,000.a. Prepare a statement of LLC liquidation.b. Provide the journal entry for the final cash distribution to members.c. What is the role of the income- and loss-sharing ratio in liquidating an LLC?arrow_forwardSTATEMENT OF PARTNER SHIP LIQUIDATION WITH LOSS After several years of operations, the partnership of Nelson, Pope, and Williams is to be liquidated. After making closing entries on March 31, 20--, the following accounts remain open: REQUIRED 1. Prepare a statement of partnership liquidation for the period July 120, 20--, showing the following: (a) The sale of noncash assets on July 1 (b) The allocation of any gain or loss to the partners on July 1 (c) The payment of the liabilities on July 15 (d) The distribution of cash to the partners on July 20 2. Journalize these four transactions in a general journal.arrow_forwardLump-Sum Liquidation with Loss on Realizationarrow_forward
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